My Introduction to the first issue of the Humane Studies Review, vol. I no. 1 1982↩

We have deliberately called our study guide The Humane Studies Review because we believe the phrase, "Humane Studies," best describes the field of our interest. Our concern is with all those disciplines which deal with human action and with the moral and economic choices people make in their everyday lives. They include not only the traditional social sciences of law, political science, economics and sociology, but also the "sciences humaines" - those more broadly conceived investigations into human nature and history which are normally made by the students of moral philosophy, intellectual and the more traditional forms of history. We believe the libertarian or Real Liberal (throughout this guide, the terms libertarian, Classical and Real Liberal will be used synonymously) approach to the "sciences humaines" can offer profound and original insights into the problems of human conflict and association. Thus, it will be an unashamedly Liberal perspective which will be taken in all our essays.

We should also be explicit about what we mean by the term "Real Liberalism." Fundamentally, we are concerned with the dignity, worth and sanctity of the individual. We hold that all individuals are unique and that their uniqueness and differences are the source from which their various, different values flow. From this difference in values and interest comes, in turn, the need to engage in exchanges, to trade peacefully, and to form voluntary associations to satisfy the human need for companionship, security and culture.

We also believe that each individual human being is morally autonomous and should be held fully responsible for his or her actions, if and when they impinge upon the rights of others. Only when human uniqueness and autonomy are respected (by respecting others' privacy and tolerating their differences) can the individual achieve self-actualisation and develop his or her potential to the full.

The means by which the privacy and autonomy of the individual are defined is property. Each person has an imprescriptible right of ownership in his or her own body as well as in all objects into which the individual's labor has been mixed. The right of property defines an inviolable space around the individual and thus protects him or her from the invasions of others. When property rights are respected the individual can develop as he or she thinks fit.

Rights also provide a sound method by which social conflicts can be avoided or, if necessary, resolved. To respect property rights one needs a legal system whose function it is to enforce individual property rights. Traditionally it has been the task of private or common law to do this and to adjudicate the conflicting claims to property which are the inevitable result of well-intentioned human interaction.

Central to the Classical Liberal philosophy is the principle of justice. By this we mean that each person should do, towards every other person, all that justice requires him or her to do (i.e., return stolen property, pay restitution for damages to person or property) and that each person should abstain from doing to another, anything that justice forbids him or her to do (i.e., any act of robbery, arson, murder or any other crime against the person or property of another). When individual personal and property rights are respected, the unmolested free exchange of property titles between individuals can take place. The freedom to trade is a fundamental tenet of Real Liberalism and extends to both the domestic and the foreign sphere of human action. It is merely the application of the principle of voluntarism to economic matters. When the interests of the interacting parties are rightly understood, there is complete harmony of interests. On an international plane, this harmony of interests results in peace-the most important policy implication of Classical Liberalism.

The result of innumerable voluntary exchanges and interactions is a spontaneous order. Being neither the planned outcome or the desire of any one person or group of people, it is rather the unintended consequence of free people going about their rightful business. If the original property rights are just, then the result of this dynamic and constantly adjusting socioeconomic constellation will be a just social order. By using our reason we can investigate and understand the social universe around us. We can determine when a claim to property is just and when it is not. Reason is the tool we use to arbitrate disputes and resolve the conflicts between human beings. Force is eschewed as a means of solving disputes and is resorted to only as a last resort to defend personal and property rights, when all other means of solving the dispute have failed. To the Classical Liberals, war was essentially a criminal activity which was undertaken by governments in the interest of vested interests and at the tremendous expense of the individual.

If war and other forms of violent activity can be reduced to their absolute minimum and the peaceful effects of trade and voluntary association are permitted to be felt, then there are some grounds for optimism. The market is the best means we have for improving the material and spiritual condition of the broad mass of the people. Only if people are allowed to [p. 2] pursue their own interests free of supervision and the forceful intervention of governments, churches or political parties can we achieve the high level of prosperity and progress which the market promises us.

These are the basic principles of Real Liberalism and we intend discussing them more fully in both their historical and theoretical forms. Future review essays will discuss the historical development of the ideas which form our intellectual liberal heritage. We will also discuss these ideas in their modern theoretical form in an attempt to flesh out a consistent and comprehensive Real Liberal world view.

This brings us to the aims of this study guide.

The primary aim of this study guide is to help students learn about the complexities of the liberal world view in the most efficient and pleasurable way possible and, at the same time, to inform them of what is going on in libertarian and traditional scholarly circles. We intend writing and editing bibliographic review essays on topics of interest to students of liberty, which will cover political philosophy, economics, history, the history of ideas (especially the history of Real Liberal thought), law and jurisprudence, moral philosophy, and the humane sciences in general. Many of these bibliographies will be written by libertarian experts who have written on or who are working on these topics. Our intention is to present the most important books and articles, both modern and hard to find classics, with a critical commentary so that the reader can quickly find which book or article to read first, in order to begin his or her reading in that subject area. Most importantly, we also hope to show how a particular author approaches his subject and how his ideological perspective can distort or lead to misunderstandings. By critically assessing each author's contribution, it is hoped that a truly liberal perspective will emerge.

A second aim of this newsletter is to help libertarians regain their intellectual heritage. From what one learns in political science and history classes it would be easy to reach the conclusion that no credible alternative to statism, in its various guises, has ever been developed. This is a completely erroneous conclusion to draw and we hope to demonstrate by means of our bibliographical review essays on the history of liberal ideas that libertarians can proudly claim a long and distinguished tradition which stretches back at least as far as the 16th century-if not right back to the Roman Republic. It is important to realize that the ideological struggle between State Power and Liberty is probably as old as human society itself, and that we can learn much from studying the efforts of others to understand and oppose the intruding and disruptive activities of the state and other organized coercive groups. The study of our libertarian heritage is instructive for its philosophical and historical insights into the nature of individual rights and the power of the state. On a more personal level, it is often profoundly moving and inspiring to read of partially successful attempts to remove the shackles of state power, or of the courageous-though often futile-opposition of particular individuals to the grossest excesses of state power throughout the centuries. However, given the direction of world history since the late 19th century, the occasions for optimism and inspiration have considerably diminished; this can only strengthen our determination to understand the past. For it is only by understanding the past that we can begin to understand the present, and thereby take steps to change our present condition.

The third aim of this newsletter is to help students arm themselves with the intellectual tools necessary to oppose the idea of the State in the often unfriendly environment of a university or college. Many libertarians find themselves isolated on campus far from centers of libertarian activity. They are faced with the choice of hiding their political views under a bushel or making their views known, thereby having to answer the criticism of faculty and other students who share the dominant political faith. If the former choice is made, the cause of liberty is not advanced and others cannot learn of the libertarian alternative. If the latter course is our choice, we must be sure we understand the paradigm of liberty and can ably defend it in the face of opposition. It is hoped that this newsletter will assist those who choose the difficult, but ultimately rewarding task of offering others a well-thought-out, radically different view of the social universe.

To do this requires knowledge and the confidence which knowledge brings, By suggesting important books to read, by reviewing articles and books around a particular theme and, perhaps most importantly, by attempting to show how various and varied ideas interconnect and relate to a unified libertarian worldview, we will be able to assist this process of learning in some way. Of course, given the limitations of space, we cannot hope to include every book and article on any given topic. All we are trying to do is to provide a starting point for your own further reading and research (perhaps for a term paper or honor's thesis). We hope you will find this newsletter a useful tool, something which may lead you to something new and which will save you valuable time in searching for material. Above all, we hope you will be stimulated to learn more about our great libertarian heritage and the exciting and rapidly growing body of thought which goes by the collective name of Libertarianism.

The Basic Tenets of Real Liberalism by Walter E. Grinder and David M. Hart↩

HSR vol. 1, no. 3 (1982), pp. 1-5.

[p.1]

Editor's Introduction

Also with this issue we begin a series on "The Basic Tenets of Real Liberalism." Real Liberalism is not just a political and economic philosophy but a complex and all-encompassing social theory as well. It has profound things to say about the individual and his or her fundamental rights, at one end of the scale, and the largest and most intricate network of social and economic relations imaginable, at the other. Few theories are as embracing in their scope or as attentive to the importance of the individual as real liberalism. We hope this series of short articles will give the reader some flavor of its variety and its power in integrating and interpreting social and economic phenomena.

Authors' Introduction

In the following series of articles we will be examining the basic tenets of real liberalism. It is our contention that liberalism comprises a coherent body of principles which is held together and given meaning by two fundamental moral principles. The first being the right of the individual to own justly acquired property; the second being the right of the individual not to be aggressed against. All the tenets of real liberalism which we will discuss flow from these two fundamental rights of ownership and non-aggression. It is our aim in these articles to show exactly how and why these two must be fundamental, and to outline the consequences this has for a political philosophy of real liberalism.

In Part I we begin with the twin ideas of "Individuality and Privacy," showing how the individual is defined by his or her physical uniqueness and so has the potential to develop into a mature and responsible acting individual. We will show how the individual's uniqueness forms the basic element of all social interaction and is the source of the division of labor and the exchange process. Similarly, privacy is shown to be the result of recognizing the dignity, worth, and sanctity of every individual. Only by permitting the individual to enjoy his or her property unmolested, within the protected sphere defined by the self-ownership principle and the derivative right to own property in other physical objects, can there be true privacy and protection of the private side of human life.

In a future article, the problems of "Toleration and Moral Autonomy" will be discussed. The argument is that tolerance results from the recognition that all individuals are potentially morally perfectible. As long as no property rights are violated, then all consenting, peaceful activity must be legally protected, especially if this activity is offensive or obnoxious to some groups. Tolerance is vital because it allows each and every individual to be truly humane, i.e. to exercise moral autonomy. Only by being free to choose between different courses of action can the individual learn from past mistakes and so strive for moral perfection and self-fulfillment.

Other articles will deal with the social consequences of the right to own property and the non-aggession principle. When people are left free to pursue their own interests it is inevitable that they will trade and exchange goods and services amongst themselves. When justly-held titles to property are freely exchanged, then we have "Social Harmony, Free Trade, and Peace," (addressed in Part II). When the State- or any other organized, coercive body- interrupts free trade amongst individuals the result is "Interventionism, Social Conflict, and War." The net result of the myriad of exchanges and voluntary associations constantly formed in the marketplace is a "Spontaneous Order," a subtle and extremely complex network of relationships that give unity and flexibility to the market process. The prerequisite for a justly- and efficiently-operating spontaneous order is a legal system which identifies and protects property rights. With "Justice and the Rule of Law" we have the legal [p. 2] framework that enables the exchange process-and all voluntary relationships-to develop in a safe and protected environment.

As the market system is gradually extended and given greater protection under the rule of law, it is not surprising that classical liberals are convinced that an era of "Reason, Optimism, and Progress" will begin, where individual rights will be respected and people will be completely free of impediments to prosper and grow, both economically and spiritually. But before this age of prosperity and growth can begin, there are many hard years of struggle ahead. Part of this struggle will involve the attempt of individuals to regain their political sovereignty. It is a consequence of the ownership of one's body and the moral autonomy that springs from this ownership that no one can act on any individual's behalf unless expressly and formally delegated to do so. This means that individuals will have to begin claiming their rights of self-determination, the right to withdraw or secede from any political organization that is not to their liking, the right to resist political intervention in their social and economic activities, and most importantly, the right to resist the ultimate theft, taxation by the state. Hence the importance of the idea of "Popular Sovereignty and the Right of Resistance."

Whenever a ruler makes himself a dictator, all the wicked dregs of the nation - I do not mean the pack of petty thieves and earless ruffians who in a republic, are unimportant in evil or good - but all those who are corrupted by burning ambition or extraordinary avarice, these gather round him and support him in order to have a share in the booty and to constitute themselves petty chiefs under the big tyrant. - Étienne de La Boétie, Discourse of Voluntary Servitude.

As these economic and political measures to restore individual rights are gradually taken, the problem of undoing past crimes and injustices must be faced. Not only must individual property rights be respected in the present and in the future liberal society, but where possible, all past aggressive actions must be corrected. This involves returning stolen property to its rightful owners (where they can be identified) or to their descendants. It also means morally assisting the just struggle of other people in their efforts to liberate themselves from their own oppressive State apparatus. And once the restrictions have been lifted, a constant watch must be made to ensure that organized violence does not again raise its head and restore the State in a new form. We will conclude "The Basic Tenets of Real Liberalism' with a section on the problems of "Liberation, Restitution, and the Revolution of Permanence."

In short, our aim is to show that real liberalism or libertarianism is a comprehensive set of principles that explains the social world in which we now live. It also describes the manner in which one should interact with one's fellow human beings in order to create a just and viable social order. It offers principles, policies, and broad programs to alter the existing political reality, and it points the way for the peaceful development of the institutions that are necessary to sustain this newly-created social order, once it has been attained.

Part I. Individuality and Privacy

Recommended Reading

Wilhelm von Humboldt, The Limits of State Action (Cambridge University Press, 1969).

John Stuart Mill, "On Liberty," in The Utilitarians (Garden City, New York: Anchor Books, 1973).

David L. Norton, Personal Destinies, A Philosophy of Ethical Individualism (Princeton University Press, 1976).

Yehoshua Arieli, Individualism and Nationalism in America (Baltimore: Penguin Books, 1966), Chapters 6, 8, 9, and 12.

 

Governments all around the world intrude massively into the private lives of their citizens and thereby attempt to mold their lives and minds. This is usually done in order to make the citizens conform to some broadly-defined notion of the. "public interest," and/or the desires of the ruling elite. These two disturbing facts of modern political life are in direct opposition to one of the most basic of libertarian tenets: the concept of the uniqueness, worth, dignity, and sanctity of the individual.

This central concept of individualism is derived in large part from the Judeo-Christian tradition, especially as the concept was revived by the thirteenth-century philosopher, Saint Thomas Aquinas. According to Aquinas, what makes human souls quite different from one another is their union with different physical bodies (see F. C. Copleston, Aquinas, Baltimore: Penguin Books, 1955, 1966). This idea of the uniqueness and worth of the individual was further developed by the Dutch humanist, Desiderius Erasmus (1466-1536); and the innerlight Protestants of the sixteenth, seventeenth, and eighteenth centuries, who believed that every individual carried the divine presence within his or her soul. For a general history of this concept, see Wilson H. Coates, Hayden V. White, and .J Salwyn Schapiro, The Emergence of Liberal Humanism: An Intellectual History of Western Europe, vol. 1, (New York: McGraw-Hill, 1966), especially chapter one,"The New Religious Outlook: Toleration and Intellectual Freedom,' and chapter nine , "Intellectual and Religious Freedom."

Later, the twin concepts of individualism (which would perhaps be more properly named individuality, to avoid the often derogatory connotations of the word "individualism"') and privacy were more fully and consistently developed, both in their philosophical and political dimensions, by real liberals such as John Locke; Wilhelm von Humboldt, whose treatise The Limits of State Action, ed. .J W. Burrow (Cambridge University Press, 1969) is an elegant plea for the government to stay out of the lives of the people, which he argued would ensure moral autonomy and foster the richness and diversity of the individual, thus leading in his opinion to a higher civilized order; and the Marquis de Condorcet. His Sketch for a Historical Picture of the Progress of the Human Mind (trans. June Barraclough, New York: Noonday Press, 1955) was written while he awaited certain death at the hands of the Jacobins during the French Revolution; it is one of [p. 3] the premier testimonials to the unfettered human mind and to progress.

Other liberal writers to whom the concepts of individuality and privacy were paramount include Benjamin Constant, De l'esprit de conquête (On the Spirit of Conquest) in De la liberté chez les modernes (On the Modern Concept of Liberty) ed. M. Gauchet (Paris: Livre de Poche, 1980); and John Stuart Mill, On Liberty. Others were Thomas Paine whose Common Sense and Rights of Man serve as two of the most passionately reasoned statements of natural law and individual rights ever written; and the individualist anarchist , William Godwin (1756-1836). Godwin's Enquiry Concerning Political Justice and its Influence on Modern Morals and Happiness (Harmondsworth, England: Penguin Books, 1976), is a brilliant argument by an unreconstructed individualist for the necessity of social interaction and the absence of coercion for the full development and happiness of the individual (p. 757). For a recent analysis of Godwin's thought, see John P. Clark, The Philosophical Anarchism of William Godwin (Princeton University Press, 1977).

Individuality means that while sharing with one's fellow human beings a number of general characteristics -reason, purpose, will, rights— each individual is in fact unique, and potentially has something no one else has to offer his or her fellows (i.e., society). Although the eighteenth- and nineteenth-century liberals based their defense of individuality firmly on moral principles drawn from natural law, there is another dimension to the meaning of individuality that deserves mention. Developments since the Second World War in biochemistry and genetics have indicated that there are sound scientific reasons to support the idea of individuality. Roger .J William's pathbreaking study, Biochemical Individuality: The Basis for the Genetotrophic Concept (Austin, Texas: University of Texas Press, 1956, 1977) demonstrates, with a formidable array of evidence, that each person is genetically distinct from every other individual. This means that each individual has not only different physical characteristics, but is endowed with a mix of talents, propensities, and potential unlike any other person's. He or she is thus truly unique and irreplaceable. This is an important scientific highlighting of the real liberal tenet of individuality or individuation. Such individuation is of obvious importance to the theory of the division of labor and social integration-topics which we will discuss at length in future sections of this paper. Furthermore, William's findings seem to undercut much of the typical egalitarian case for redistributivist measures. Williams should be read alongside the following: Hampton C. Carson, Heredity and Human Life (New York: Columbia University Press, 1963); Felix Morley, ed., Essays on Individuality (Indianapolis: Liberty Press, 1977); and the title essay in Murray N. Rothbard's Egalitarianism as a Revolt Against Nature and Other Essays (Washington, D.C.: Libertarian Review Press, 1974).

That each and every individual has something unique and valuable to offer his or her fellows is a view eloquently defended by the philosopher David L. Norton in Personal Destinies: A Philosophy ofEthical Individualism (Princeton University Press, 1976). Norton's work is a modern restatement of the philosophy of Eudaimonism, the roots of which lie in the ancient Greek Stoic school of philosophy. Following the Socratic instruction to "Know Thyself," Eudaimonism offers the further instruction to "Become What You Are," or in other words, "Be Thyself." It is the philosophy of self-knowledge and self-actualization. Given a proper self-knowledge (i.e., what one genetically is and can do) then the pursuit of self-knowledge is synonymous with the pursuit of happiness. This of course has been a key element of real liberal thought throughout its history. Many liberals insisted that the individual has to be free so that he or she is able to pursue his or her own happiness directed only by his or her own unfettered powers of critical choice and conscience. These liberals did not necessarily believe that each individual would choose to be a self-actualizer in this fashion, but rather that individuals have to be free of outside political constraints so that they at least have the possibility of making these choices.

To universalize our behavior under given circumstances is not to hold that under these circumstances all persons ought to behave in identical fashion to ourselves, but rather to hold that every other person ought to act so as to express his unique personhood with respect to these circumstances, as we ourselves do. - David L. Norton, Personal Destinies.

One of the most interesting of Norton's ideas is the concept of the "complementarity of excellences," by which he means that "every genuine excellence benefits by every other genuine excellence. It means that the best within every person calls upon the best within every other person" (p. 10). This idea leads to a strong philosophical foundation for the division of labor and spontaneous order theories of social integration. Norton can be read along with Abraham Maslow, Toward a Psychology of Being (New York: Van Nostrand, 1968); .J S. Mil, On Liberty; Herbert Spencer, Social Stataics (New York: Robert Schalkenback Foundation, 1970); Humboldt, The Limits of State Action; and Auberon Herbert, The Voluntarist Creed (London: W. J. Simpson, 1908). All are classic statements on the uniqueness of the individual.

The fact of individual uniqueness becomes especially important when we consider the process of social integration. Individual uniqueness implies differences, and it is these differences that establish the natural conditions of exchange, which in turn leads to the division of labor, specialization, comparative advantage, and the socio-economic exchange process. This important insight into the motives and conditions for mutually beneficial exchange and social integration was first made by the classical economists of the late eighteenth and early nineteenth centuries. It became a key insight of David Ricardo in his theory of comparative cost in the chapter "On Foreign Trade" in The Principles of Political Economy and Taxation, first [p. 4] published in 1817 (London: J.M. Dent and Sons, Everyman edition), ed. Ernest Rhys, pp. 77-93. On Ricardo's contributions, see Samuel Hollander, The Economics of David Ricardo (University of Toronto Press, 1979), "Comparative Cost and Specie Distribution," p. 459-473.

Ludwig von Mises also stressed the idea that individual differences are the basis for social cooperation. His term for the economic aspect of the complementarity of excellences is the "law of association," by which he means that through the division of labor both the less endowed, as well as the more talented, the more industrious, the more able, will mutually benefit from exchange. In fact, like William Godwin , Mises goes so far as to argue that not only is the individual better off by trading with his or her fellows, but actually requires society as the means for attaining all of his or her individual and personal ends. See Human Action (Chicago: Henry Regnery, 1949, 1963, 1966), "The Ricardian Law of Association," pp. 159-164 , and "The Individual Within Society," pp. 165-166.

The real liberal doctrine states that since each individual is unique and has the potential of practically unlimited growth and self-development, he or she is of inestimable worth both as an individual and as a member of society. Furthermore, each individual is an end in himself and therefore must be treated as such, never involuntarily serving as merely a means to another's ends. The classic formulation of this position is given by Immanuel Kant in the Groundwork of a Metaphysic of Morals, H. J. Patton, trans, and ed. (New York: Harper Torchbooks, 1964).

Although it is true that we all make use of others asmeans in our social and economic relationships, and although it is true that occasionally we "use" others "involuntarily" (for example, a member of one sex often derives pleasure from the welcome "externalities" emanating from the passing-by of a member of the opposite sex), we must always bear in mind Kant's warning: under no circumstances must we really involuntarily (i.e., by means of force or the threat of force) use another to achieve our ends. Each person is and must remain an end in him or herself.

Each individual, being potentially morally perfectible, deserves to be treated as an equal by his fellows and by the law. (On human perfectibility, see Condorcet's Sketch for a Historical Picture of the Progress of the Human Mind. In particular, the Tenth Section deals with the struggle between reason and superstition and power throughout history. It ends, in the Tenth Epoch, with a poetical vision of the future, a future of the free human mind, of science and a future worthy of optimism.) Each person, being a potentially dignified human being, deserves to be treated in a dignified manner (i.e., that one's rights and privacy be respected). As long as a person refrains from infringing upon the equal rights of others, he or she must be accorded the rights to think, to act, and to exchange as he or she sees fit.

This then is the essence of the real liberal doctrine of individuality and privacy. There must be a protected space around each individual which is reserved and protected for that individual's unique enjoyment. An individual's thoughts (whether religious or secular), property, and peaceful actions must be beyond the reach and jurisdiction of any individual or institution whatsoever. Unless the individual engages in some violent, criminal activity, he or she should on no account be interfered with.

There are many histories of individualist thought and, unfortunately, they are of very uneven quality. A useful modern introduction is Steven Lukes, Individualism (New York: Harper and Row, 1973), and "Types of Individualism," by the same author, in The Dictionary of the History of Ideas: Studies in Selected Pivotal Ideas ed. Philip P. Wiener (New York: Charles Scribner's Sons, 1973), Vol. 2, pp. 594-604. Lukes's works must be used with caution because the author is too tied to the ideas of egalitarianism and democracy to be sufficiently sympathetic to the subject of individualism. A far better, but much older work is by Albert Schatz, L'Individualisme économique et sociale (Social and Economic Individualism) (Paris: Armand Colin, 1907). Schatz, being a classical liberal, is far more sympathetic than Lukes to the subject at hand, and is far more knowledgeable of the more radical strain of individualist thought that existed in the late eighteenth and nineteenth centuries. For example, he is one of the few historians of liberal and individualist thought to give space to pioneer thinkers such as Jean-Baptiste Say, Charles Comte, Charles Dunoyer, Gustave de Molinari, and Benjamin Tucker. It is with Schatz's book that any serious researcher of individualist thought must begin.

Another classic presentation of individualism is Warner Fite, Individualism: Four Lectures on the Significance of Consciousness for Social Relations (New York: Longmans, 1910, 1924), although it should be used with caution because Fite does not always draw real liberal conclusions from his work.

One should not forget the contributions of F. A. Hayek, whose essay "Individualism: True or False," Individualism and Economic Order (Chicago: Henry Regnery, 1948, 1972) forms chapter one. It is provocative although fundamentally flawed because Hayek is excessively enamoured with English utilitarian social philosophy and misunderstands the nature of the European (especially the French) natural-law defense of individualism and individual rights.

Other useful histories of aspects of individualist thought include K. W. Swart, "'Individualism' in the Mid-Nineteenth Century (1826-1860)," Journal of the History of Ideas vol. 23, 1962, pp. 77-90; W. Ullman, The Individual and Society in the Middle Ages (Baltimore: Johns Hopkins Press, 1966); and C. B. Macpherson, The Political Theory of Possessive Individualism: Hobbes to Locke (Oxford: Clarendon Press, 1962).

An important contribution to the history of individualist thought as it developed in the United States is [p. 5] the work of the Israeli historian Yehoshua Arieli, Individualism and Nationalism in American Ideology (Baltimore: Penguin Books, 1964, 1966), especially chapter six, "'Natural Society' —The Evolution of a Social Ideal," pp. 88-120; chapter eight, "The Jeffersonian Ideal-Social and Political Democracy," pp. 156-178; chapter nine, " A European Concept Crosses the Atlantic, pp . 179-206; and chapter twelve, "Foundations of the American Ideal of Individualism," pp. 242-272.

The Basic Tenets of Real Liberalism by Walter E. Grinder and David M. Hart. Part II: Tolerance and Moral Autonomy↩

HSR vol. 1, no. 4 (1982), pp. 1-6.

Editor's Introduction

With this issue we continue "The Basic Tenets of Real Liberalism. " In the previous issue we discussed the liberal idea of individualism, basing our argument on the right of each individual to own and control his or her own body. In Part II, "Toleration and Autonomy," we extend the idea further by applying it to the problem of tolerance and individual moral

For centuries, various minorities have been viciously persecuted because of their religious or political views. Not until the Reformation of the sixteenth century did theories emerge that defended the individual's right to the uncoerced practice of his or her religious and social beliefs. Liberals quickly recognized that this right is an extension of the more basic and general right of individuals to own property in themselves, as well as in books, churches, and other physical objects. It also became obvious that the moral autonomy of the individual depended upon the opportunity to choose among alternatives without being coerced. Without uncoerced choice there can be no morality. The tradition of tolerance for diverse ideas and respect for the property rights of those who peacefully act upon their religious and political ideas began during the sixteenth century. It has continued to be a central part of the classical liberal tradition.

The Basic Tenets of Real Liberalism Part II: Tolerance and Moral Autonomy

Recommended Reading

Lysander Spooner, Vices Are Not Crimes: A Vindication of Moral Liberty (Cupertino: Tanstaafl, 1977).

Robert Nozick, Anarchy, State, and Utopia (New York: Basic Books, 1974), part 3.

Albert Jay Nock,"On Doing the Right Thing," in Our Enemy the State (New York: Free Life Editions, 1973).

Robert Paul Wolff, In Defence of Anarchism (New York: Harper and Row, 1976).

 

Tolerance of differences in thought and beliefs, as well as diversity of lifestyles, goes hand-in-hand with the real liberal position on individuality and privacy. It does not mean that one must necessarily accept, approve, or condone the beliefs and actions of others, but only that one refrain from initiating the use of force against them. To call for toleration of only that which one already approves of is hypocritical. Hence, one must also allow those beliefs of which one strongly disapproves, if the meaning of toleration is to have some sensible content. In addition, if one is to be consistent, one is required to extend the concept of toleration from thoughts and beliefs (the most intimate and private activity of human life) to toleration of action that is in accordance with those beliefs (especially peaceful economic activity).

Tolerance of beliefs without tolerance of action is rightly seen to be a sham of the highest order. However, the so-called "tolerance" of the actual invasion of anyone's rights would indeed be an abdication of one's liberal principles. Thus one requires a method by which rights-violating behavior can be distinguished from unpleasant, obnoxious, or irrational, but uncoercive behavior.

The means to make this distinction has been provided by the liberal tradition. It has been best expressed by the great nineteenth century English liberal, Herbert Spencer. His law of equal freedom states that "every man [and woman, ed.] has freedom to do all that he wills, provided he infringes not the equal freedom of any other man" (Social Statics (New York: Robert Schalkenbach Foundation, 1970), p. 95). If Spencer's equal liberty doctrine is universally applied, it provides a powerful method of distinguishing criminal activity from morally permissible, but perhaps offensive, activity. If a person's beliefs lead to actions which violate the person or property rights of others, then and only then can that person be forcibly restrained and compelled to pay restitution.

However, it is important to bear in mind the vital distinction between the rights-violating action and the beliefs themselves. In the strict sense, rights-violating action is a crime that can be subject to legal action- "natural crimes," to use the felicitous expression of Patrick Edward Dove, The Theory of Human Progression and Natural Probability of a Reign ofJustice [p. 2] (Boston: Benjamin B. Mussey, 1851). The rule is, so long as person and property rights are not violated by actions, there should be no valid legal reasons for using force against anyone. Even if a person's beliefs condone or suggest natural crime, the rule forbids using force against him, until he steps from belief to action.

This distinction between the violent invasion of one's property, and behavior that may transgress custom or even natural law, but does not violate anyone else's property rights, was brilliantly perceived by the American individualist anarchist, Lysander Spooner, in his 1875 pamphlet, Vices Are Not Crimes: A Vindication of Moral Liberty (Cupertino, California: Tanstaafl, 1977). The distinction noted by Spooner is a fundamental aspect of liberal political, social, and legal philosophy. It leads to the conclusion that all violations of property rights must be declared illegal, but vice (to use Spooner's term), whilst perhaps immoral in some broader sense, must be allowed to flourish, and even be given the full protection of the law. Crime, in this view, exists only where there is an individual victim of some act of force or fraud (which can be defined as implicit force).

Each society has structures for carrying on conflict with other societies and structures for carrying on sustenation ... the militant type, characterized by the (former), is framed on the principle of compulsory co-operation, while the industrial type, characterised by predominance of the (latter), is framed on the principle of voluntary co-operation ... - Herbert Spencer, Principles of Sociology.

But beyond this strict legal definition of tolerance and respect for rights lies another related dimension. Tolerance does not just mean that one respects the peaceful and voluntary activity of one's fellow human beings solely by recognizing the law of equal liberty. This deeper meaning involves the traditional liberal regard for civility and manners (i.e. the art of getting along with one's fellows in a social context). One expects to be treated by others as a rational and law-abiding individual and to be accorded the respect and dignity due such a person. Reciprocally, one should also grant these same niceties to others for the simple reason that, like you, they are individuals with similar feelings and rights, and have an equal desire to seek fulfillment, however they perceive it. Thus, one should be liberal and open-minded about all noncoercive human activity.

There are sound natural law and utilitarian reasons for tolerating the apparently abhorent or annoying, but peaceful, activities of others. Because of the uniqueness of every individual and the very different ends which individuals choose to pursue, it is often the case that what appears to be "immoral" or obnoxious is just the result of that person's efforts to be true to his or her self. It is impossible for an outsider to say whether this course of action will indeed lead to the fulfilment of that person's potential. One may have strong doubts that this will happen and the desire to "save that person from themselves" may be well-intentioned and charitable. However, for moral and physical reasons one ultimately cannot live the life of another, and so one must respect that person's natural right to seek self-fulfillment in his own way.

In many cases, the obnoxious behavior of others may have beneficial economic consequences. However, it is certainly not "'heroic,'" as Walter Block has argued in Defending the Undefendable: The Pimp, Prostitute, Scab, Slumlord, Libeler, Moneylender, And Other Scapegoats in the Rogues Gallery of American Society (New York: Fleet Press Corporation, 1976). A word of caution about Block's book: it is a hardhitting and extreme defense of all voluntary interactions from both a moral and economic perspective. Most of the chapters are valid and cleverly done, but it is not to be recommended as an introduction to libertarian theory (especially for the tender-hearted) or as a guide to polite company and good manners. A far better (and more civilized) introduction to the problem of victimless crimes is Spooner's above-mentioned Vices Are Not Crimes. Spooner, at least, does not claim that the practitioners of vice are heroes.

Another utilitarian argument, besides Block's economic one, for respecting the different beliefs and life-styles of others is the argument concerning the greater diversity and richness of life that such activity brings into being. Because of the limitations on our knowledge of future events (see F. A. Hayek's The Use of Knowledge in Society (Menlo Park: Institute for Humane Studies, 1977) Studies in Economics no. 3) it is sometimes difficult to determine the ultimate consequences of a different way of life unless someone experiments with it. It may well be that this way of life has unexpected beneficial consequences that n o one could have foreseen. This discovery may contribute immeasurably to the richness and diversity of our culture and increase, both for our children's and our own benefit, the stock of experiences we can use and learn from.

The most brilliant presentation of the possible beneficial results of allowing competing "Utopias," operating within the framework of a libertarian legal code, is Robert Nozick's Anarchy, State, and Utopia (New York: Basic Books, 1974), Part III, "Utopia." Anthony Sampson, in his chapter on "Liberalism and Creativity," in Liberty and Language (Oxford University Press, 1979), pp. 37-89, makes the very important point that diversity of lifestyles and the freedom to practice them result in a considerable increase in cultural, scientific, and technological creativity. The result of this increase in creativity, nearly always unexpected and unpredicted, is a richer and more productive life than we would have had in its absence. Although extremely utilitarian in his defense of toleration, Samuel Brittan, in his Capitalism and the Permissive Society (London: Macmillan, 1973), perceptively and sensitively shows that only under a regime of private property and free exchange can diverse life-styles and opinions exist and be protected under the law.

[p. 3]

These utilitarian arguments for toleration are all very well, but the basic defense of toleration must ultimately lie with the natural right of each and every individual to live a life unmolested by others; free to seek personal fulfillment in whatever manner seems appropriate, as long as he or she does not initiate the use of force or fraud against any other individual.

There is a second moral argument in defense of toleration, which goes to the heart of what it means to be a morally autonomous human being. One can argue that vice must not be made illegal, because vices are mistakes, whether witting or unwitting, with regard to natural law and the correct course of action which men and women should take in any given situation. One can learn the correct behavior only if one is allowed to make mistakes, and to learn from those mistakes. Spooner, in Vices Are Not Crimes, p. 32, is quite explicit about the importance of making mistakes, suffering t h e consequences and thereby gaining wisdom. This attitude is also a key insight in the thought of the Spencerians, such as William Graham Sumner (1840- 1910). See "On the Case of a Certain Man Who is Never Thought of" in What Social Classes Owe to Each Other (Caldwell, Idaho: Caxton, 1961).

And if these questions, which no one can really and truly determine for anybody but himself, are not to be left free and open for experiment by all, each person is deprived of the highest of all his rights as a human being, to wit: his right to inquire, investigate, reason, try experiments, judge, and ascertain for himself, what is, to him, virtue, and what is, to him, vice ... - Lysander Spooner, Vices are Not Crimes.

In the delightful essay, "On Doing the Right Thing," (an essay appended to Our Enemy the State (New York: Free Life Editions, 1973 originally published in 1928.) ed. Walter E. Grinder), the great stylist Albert .J Nock argued that the moral development of the individual is stunted each time the State extends its activity into new areas, because the area available for the unhindered and free exercise of the human moral faculties is thus reduced. In fact, in moral philosophy there is a fundamental assumption that individuals are responsible for their actions. It makes no sense to say that an individual should or should not do something on moral grounds —i,e., place a bet on a football game—if that individual cannot freely choose between courses of action- i.e., if betting is illegal. There literally can be no such thing as morality unless one has the freedom to choose between alternatives, without external sources of coercion.

This notion of autonomy and toleration is a basic tenet of the classical liberal tradition and the linchpin of liberal moral and social philosophy. The great classical tradition of respect for the individual was revived by the thirteenth-century medieval philosopher Saint Thomas Aquinas, who argued that each individual must examine his or her own actions in the light of his or her own knowledge and his or her own con- science. (Walter Ullman, The Individual and Society in the Middle Ages (Baltimore: Johns Hopkins Press, 1966).)

This classical revival began a tradition of philosophic and religious self-examination, which finally led religious thinkers during the Reformation to begin demanding autonomy for the individual in religious matters. Unfortunately, it was only as a result of the physical exhaustion and horror at the atrocities of torture, imprisonment, and religious warfare in the name of salvation that many philosophers and theologians were led to demand an end to religious persecution and to call for recognizing the right of the individual to be left alone. However, many Protestant theologians, such as Luther and Calvin, presented excellent justifications for the autonomy of only their own particular sect in the battle against the coercive monopoly of the Roman Catholic Church. Both Lutherans and the Calvinists were more than willing to persecute others when they were able to achieve some political independence from Rome.

The most persecuted sect of the Reformation, the Anabaptists (literally those baptised again), produced some of the best tracts calling for religious toleration and the fundamental right of the individual to pursue religious and political activities in peace. On Anabaptist ideas on peace and toleration, see G.H. Williams, The Radical Reformation (Philadelphia: Westminster Press, 1962) and Peter Brock, Pacificism in Europe to 1914 (Princeton University Press, 1972). On the question of religious toleration in general during the Reformation the following books are recommended: Joseph Lecler, S.J., Toleration and the Reformation, 2vols., trans. T.L. Westow (London: Longman, 1960); Persecution and Liberty: Essays in Honor of George Lincoln Burr (New York: The Century Co., 1931); Autour de Michel Servet et de Sébastien Castellon, ed. B. Becker (Haarlem: H. D. Tjeenk Willink, 1953) on some key figures in the movement for religious toleration; Guido Kisch "Toleranz und Menschenwürde (Tolerance and Human Dignity),"' Miscellanea Medievalia, 4, (Berlin: 1966) on the particular problem of toleration towards the Jews in this period; and Roland H. Bainton, The Travail of Religious Liberty (Hamden, Conn.: Shoestring Press, 1971).

The dean of the liberal humanists was the Dutch classicist, Desiderius Erasmus (1466-1536), whose pleas for the cessation of hostilities and the settlement of religious disputes in a civil, restrained, and peaceful manner are still moving today. All of Erasmus's work is infused with a spirit o f tolerance towards his fellows and despair at human folly in waging pointless wars and in persecuting religious minorities. His best known and remembered works are The Complaint of Peace (La Salle, Ill.: Open Court, 1974), in which the personification of peace chastises mankind for indulging in the absurdities of constant warfare, and Praise of Folly and Letter to Martin Dorn (Harmondsworth: Penguin, 1973) trans. Betty Radice, in which Erasmus pokes fun at the hypocracies of his age. Roland Bainton's Erasmus of Christendom (London: Collins Fontana Library, 1969) is a very useful study of the life and thought of this great humanist scholar and liberal. On Erasmus's views on war and peace, see Robert P. [p. 4] Adams, The Better Part of Valor: More, Erasmus, Colet, and Peace, 1496-1535 (Seattle: University of Washington Press, 1962) and José A. Fernández, "Erasmus on the Just War," The Journal of the History of Ideas, 34, 1973, pp.209-26. Specifically on toleration, see Wallace K. Ferguson, "The Attitude of Erasmus toward Toleration," in Persecution and Liberty: Essays in Honor of George Lincoln Burr (New York: The Century Co., 1931), pp. 171-81.

War is that kind of evil which, when once admitted, cannot be excluded again at will; but usually, from a little one, becomes a very great one; from a single one, multiplies into a complication; from an unbloody contest changes to carnage, and at last rises to a storm, which does not overwhelm merely one or two, and those the chief instigators to the mischief, but all the unoffending people also; confounding the innocent with the guilty.- Erasmus, The Complaint of Peace.

One of the first real liberals to put his mind and pen to the pressing problem of religious toleration in an age of religious intolerance was the great English poet and radical thinker, John Milton (1608-1674). Milton lived and wrote in a period of extreme social and political upheaval. During the English Civil War he wrote three great libertarian tracts defending religious toleration and the autonomy of the individual, Areopagitica, Eikonoklastes, and A Treatise of Civil Power in Ecclesiastical Causes. (All are included in The Student's Milton (New York: F. S. Crofts and Co., 1947) ed. Frank Allen Patterson, pp. 731-53, 775-863, 863- 914.) Milton argued for extreme tolerance in both the religious and secular world. The best modern treatment of Milton as a radical thinker is by the British Marxist, Christopher Hill, Milton and the English Revolution (New York: Penguin, 1979). The main reference work on toleration in England is W. K. Jordan, The Development of Religious Toleration in England (Harvard University Press, 1938).

Later in the seventeenth century, two classics of tolerationist thought were published in the religious and political haven which was the Netherlands United Provinces. The first is Commentaire philosophique sur les paroles de Jésus-Christ 'contrains-les d'entrer' (Philosophical Commentary on Christ's Words 'Compel them to enter') available in Elisabeth Labrousse, Oeuvres Diverses (Hildesheim: Georg Olms, 1964-68) 4 vols., vol. 2. The author, Pierre Bayle, convincingly refuted, in exhaustive detail, all arguments which had been put forward in defense of persecution. Bayle was unusual in that he even extends toleration to include Jews, Moslems, Catholics, and atheists, although he retained certain restrictions on the free propagation of "anti-social" ideas by Catholics and atheists in particular. The best single work on the life and thought of Pierre Bayle is available only in French; Elisabeth Labrousse, Pierre Bayle, vol. I: Du pays du foix à la cité d'Erasme, vol. 2: Hétérodoxe et Rigorisme (The Hague: M. Nijhoff, 1963-64), especially chapter 18, "Tolérance ecclésiastique et tolérance civile," p. 520-43, and chapter 19 "La liberté de conscience", pp. 544-91. There are two useful English works, Karl C. Sandberg, At the Crossroads of Faith and Reason: An Essay on Pierre Bayle (Tucson: University of Arizona Press, 1966), especially chapter 8, "Faith and Tolerance," pp. 68-80; and the collection by Walter Rex, Essays on Pierre Bayle and Religious Controversy (The Hague: M. Nijhoff, 1965). Bayle's best-known work is his Historical and Critical Dictionary, which is expertly introduced and edited by Richard H. Popkin (Indianapolis: Bobbs-Merrill, 1965).

The second classic published in the freedom of the Netherlands was John Locke's Epistola de Toleratia. A Letter on Toleration, trans .J W. Gough, introduced by R. Klibansky (Oxford: Clarendon Press, 1968). This essay is a glorious statement in defense of toleration, in spite of Locke's unfortunate qualification of tolerance in the case of atheists. It was a common view at the time that because atheists refused to take oaths, they were therefore a risk to security and social cohesiveness. Klibansky's introduction and J. W. Gough's "The Development of Locke's Belief in Toleration," in *John Lockes' Political Philosophy. Eight Essays by J. W. Gough (Oxford: Clarendon Press, 1973) are good introductions to Locke's thinking on the question of tolerance.

The Dutch philosopher, Benedict Spinoza (1632- 1677), should also be mentioned in connection with the idea of toleration. As a Jew and a rationalist, he was particularly aware of the problem of persecution. Like Bayle and Locke, Spinoza sought refuge in the relative security of the Netherlands, where he wrote his famous Ethics (1677), in which he deals with the problem of individual autonomy. The best edition is Ethics preceded by On the Improvement of the Understanding (New York: Hafner, 1949), ed. James Gutman.

On the importance of the Netherlands as a political refuge and as a source of tolerationist thought, see John J. Murray, "The cultural impact of the Flemish Low Countries in sixteenth- and seventeeth-century England," American Historical Review, 62, 1956-57, and C. Louise Thijssen-Schouten, "La diffusion européenne des idées de Bayle," in Pierre Bayle. Le Philosophe de Rotterdam (Paris: Librairie Vrin, 1959) ed. Paul Dibon, pp. 150-195.

(Others must recognize] the inalienable right which we possess, in common with the rest of mankind, to profess doctrines which we believe to be in conformity with the truth. - Pierre Bayle, Letter IX in Ouevres diverses.

In Germany, the jurist and political philosopher Samuel von Pufendorf (1633-1694) made fundamental contributions to the natural-law defense of individual sovereignty and religious tolerance. Pufendorf built upon the work on natural law by the Dutch humanist and jurist, Hugo Grotius (De Jure Belli ac Pacis - On the Law of War and Peace (1625) (Washington, D.C.: Carnegie Institution, 1913-25) 2 vols.). Pufendorf's argument for the right of the individual to legal equality and liberty, presented in the 1672 work De Jure Naturae et Gentium -On the Law of Nature and Nations (New York: Oceana, 1964) 2 vols., was based on his theory of the dignity of men and women and their inherent sociability. Pufendorf vigorously defended the individual's freedom of conscience and the idea of tolerance in general in De Habitu Religionis Christianae ad Vitam Civilem (On the Attitude of the Christian Religion to the Civil Life, 1687). [p. 5] Useful introductions to the thought of these giants of international and natural law include Leonard Krieger, The Politics of Discretion, Pufendorf and the Acceptance of Natural Law (University of Chicago Press, 1965); Charles S. Edwards, Hugo Grotius. The Miracle of Holland. A Study in Political and Legal Thought (Chicago: Nelson Hall, 1981); and the relevant chapters of Richard Tuck, Natural Rights Theories: Their Origin and Development (Cambridge University Press, 1979).

These theoretical advances in defense of individual autonomy and toleration were not quickly translated into political or social reform. Mankind had to wait almost two centuries until the political successes of the Enlightenment (largely due to the intellectual activity of Voltaire and the Philosophes) for the autonomy of the individual in regard to religious matters to be even partially recognized, and then extended, to the domain of political and economic activity. The best introduction to the Philosophes' struggle for religious toleration is "Toleration: A Pragmatic Campaign" in The Enlightenment: An Interpretation, Volume II: The Science of Freedom (New York: Norton, 1977), pp. 398-407, by Peter Gay.

A brilliant and explicit attempt to push religious protestantism into the political realm (classical liberalism could perhaps be seen as a form of political protestantism) is Edmund Burke's (1729-1797) early essay, "A Vindication of Natural Society; or a View of the Miseries and Evils Arising to Mankind from every Species of Artificial Society" (1756). A modem critical edition edited by Frank N. Pagano, has just been published as A Vindication of Natural Society, (Indianapolis: Liberty Classics, 1982). Burke argued that deistic attacks on the privileges of the state church are, in theory, similar to the radical natural-law attack on all forms of "artificial" political society and its privileges. He further reasoned that, if it was wrong for the church to impose its monopoly of belief and worship, then it must also follow that it is wrong for the state, in any form, to impose its political monopoly of coercion. In Burke's view, all voluntary activities and associations make up what he called "natural society." Opposed to this was what he called "artificial society," which included all coercive and political institutions. These institutions (governments, monopoly state churches) were the creation of some deliberate act of power which had as its aim, the control or destruction of voluntary activity.

Scholars are not certain whether Burke's essay was a piece of youthful radicalism, or an exercise in rhetoric and satire, because the views expressed in this pamphlet are very different from Burke's later, very conservative political philosophy. In support of the view that the "Vindication" is a serious and radical document, see Isaac Kramnick, The Rage of Edmund Burke: Portrait of an Ambivalent Conservative (New York: Basic Books, 1978) and the article by Murray N. Rothbard, "A Note on Burke's Vindication of Natural Society," in Journal of the History of Ideas, 1958, pp. 114-18.

By sure and uncontested principles, the greatest part of the governments on earth must be concluded tyrannies, impostures, violations of the natural rights of mankind, and worse than the most disorderly anarchies. - Edmind Burke, Vindication of Natural Society.

Perhaps the classic statement of individual autonomy can be found in the writings of the German Enlightenment philosopher, Immanuel Kant (1724- 1804). We have mentioned Kant in a previous essay in the Humane Studies Review (vol. 1, no. 2) so we will not deal with his thought at length here, except to mention that the best statement of his views on autonomy and individual sovereignty can be found in the Groundwork of a Metaphysic of Morals (New York: Harper and Row, 1964) ed. H. J. Paton. A modem version of Kant's theory of autonomy bas been very effectively used by the philosophers Robert Paul Wolff and Antony Flew. Wolff's short classic, In Defense of Anarchism (New York: Harper Colophon, 1976) is must reading. The first chapter is important, especially sections 2 and 3, "The Concept of Autonomy" and "The Conflict Between Authority and Autonomy." The English philosopher Antony Flew convincingly argues for a neo-Kantian version of personal equality based upon individual autonomy, and argues against various forms of coercive egalitarianism in "The Procrustean Ideal: Libertarians v. Egalitarians," Encounter 1978, vol. 1, no. 3, and in his book The Politics of Procrustes (London, M. Temple Smith, 1980).

As Immanuel Kant, Anthony Flew, and Robert Paul Wolff demonstrate, in order to be a truly human and social being, every individual must retain and exercise his or her moral autonomy. He or she must be left free to act according to the dictates of his or her conscience and reason. The individual may make mistakes, but these errors do not excuse the individual from responsibility. If moral autonomy is to have any meaning, each individual must assume full responsibility for ail his or her actions.

Tolerance is crucially important in protecting the moral autonomy of the individual. In effect, tolerance creates the conditions that allow each individual the maximum number of alternatives. Furthermore, tolerance is morally necessary, if each individual is to be allowed to live a moral life. Only in choosing among alternatives can an individual attempt to achieve moral perfectibility.

In theory, moral perfection is attainable by every individual, if each makes a persistent and constant effort to choose the good and act accordingly. In practice, given the failings and weaknesses of the human spirit, such persistence will prove difficult, but it is clearly not a physical or logical impossibility. Any impediment blocking or hindering the exercise of one's free will, or preventing one from living in accordance with the "inner vision" provided by one's conscience and reason (subject, as always, to the doctrine of equal liberty), should not be countenanced. This liberal concern [p. 6] for the unhindered pursuit of one' s vision is a major element of two of the greatest statements of man's moral perfectibility: William Godwin's Enquiry Concerning Political Justice (Harmondsworth: Penguin, 1978), ed. Isaac Kramnick, and Condorcet's "Sketch for a Historical Picture of the Progress of the Human Mind," in Selected Writings, ed. Keith Michael Baker (Indianapolis: Bobbs-Merrill, 1976). Real liberals must strenuously oppose ail intolerance and all coercive impediments to individual moral development. This must be done not only because diverse lifestyles and beliefs are likely to benefit ail individuals in society with increased creativity and a larger choice of alternatives, but primarily because it is the morally correct thing to do.

We will continue to de scribe the basic principles that real liberals consider to be morally correct in further issues of the Review.

The Basic Tenets of Real Liberalism by David M. Hart and Walter E. Grinder. Part III: Social Harmony, Free Trade, and Peace↩

HSR vol. 2, no. 3 (1985), pp. 1-5.

Editor's Introduction

This and the next article will deal with related but antithetical problems, namely the opposition between "Social Harmony, Free Trade and Peace" and "Interventionism, Social Conflict and War."

In this issue we deal with the former group of concepts which forms such a vital element in any theory of Real Liberalism. The underlying assumption is that all freely interacting individuals enjoy a harmony of interests. These shared interests include the maximization of opportunity and production brought about by the division of labor and the industrial economy. As long as the use of coercive force is outlawed, no individual or group of individuals can create legal privileges which disrupt the natural harmony of the market.

Many real liberals have seen the important theoretical connection between the free market and international peace. Just as the division of labor and the abolition of legal privilege on an individual plane maximizes human well-being, so too does the extension of these principles to the international plane bring about an opportunity for greater productivity and the lessening of inter-state rivalries. Since peace is the most important consequence of free trade and free market policies it is not surprising that liberals have been active over the centuries in attempting to bring about an end to the waste and destruction brought on by state intervention, both internally and externally.

The great Austrian economist, Ludwig von Mises, provides us with the concept of "interventionism" that explains how the prosperity and peace of the market is replaced by the disruption and conflict of state intervention. We conclude this article with brief discussion of Mises's theory of interventionism and we will return to it in the next issue when we will discuss the problems of "Interventionism, Social Conflict, and War."

Part III: Social Harmony, Free Trade, and Peace

Recommended Reading

Frédéric Bastiat, Economic Harmonies (Princeton, N:J D. Van Nostrand, 1964).

Richard Cobden, "Free Trade and Reduction of Armaments," Free Trade and Other Doctrines of the Manchester School, ed. Francis W. Hirst (New York: Augustus M. Kelley, 1968).

Ludwig von Mises, The Free and Prosperous Commonwealth: An Exposition of the Ideas of Classical Liberalism (Princeton, NJ: Van Nostrand, 1962), trans. Ralph Raico, ed. Arthur Goddard.

William Graham Sumner, "War" and "The Conquest of the United States by Spain," in War and Other Essays (New Haven: Yale University Press, 1911), ed. Albert G. Keller.

 

Social conflict and economic class warfare are commonly considered to be endemic to the capitalist system. The antagonisms between black and white, rich and poor, capitalist and worker, appear intractable and impossible to solve. Only state intervention (as in the welfare state) or revolution (to create the "dictatorship of the proletariat") is believed to be able to reduce or eliminate this class conflict and thus to permit individuals to lead a prosperous and peaceful existence. Such intractable disharmony and conflict between individuals would, on the surface, seem to contradict another of the tenets of Real Liberalism, namely the harmony of interests doctrine. But, as we intend to demonstrate, this contradiction between strife-torn reality and liberal ideals is only apparent.

Harmony of Interests

The best way to begin unravelling this dilemma is to examine what Real Liberals have meant by the concept of the harmony of interests. No Real Liberal believed that a market system infested with government intervention could possibly be free of social conflict. On the contrary, liberals who addressed the problem of conflict and harmony (in particular Jean-Baptiste Say, Frederic Bastiat, Richard Cobden, and Ludwig von Mises) were convinced that only in a world where voluntary social and economic interactions remained completely free (i.e., a policy of unrestricted laissez faire, laissez passez in the terminology of the Physiocrats) would there be no harmful group conflict. Liberals believed that the market allowed the beneficial results of the harmony of interests to be felt at all levels. As soon as the [p. 2] state intervenes to control voluntary relationships, the natural harmony of the market is destroyed and conflict appears. If allowed to continue uninterrupted, this group and class conflict may gradually worsen until the point of economic stagnation and breakdown is reached. Under certain circumstances the disharmonies created by state intervention may even lead to war and violent revolution.

One could go back to ancient Greek philosophy to find the beginnings of the idea that social interaction produces a harmonious order independent of the intention of the participants. Our brief survey will begin with the Anglo-Dutch physician and social theorist Bernard Mandeville. The importance. of Mandeville is that, in the early years of the eighteenth century, he saw that if individuals were able to pursue their self-interest (Mandeville called this "private vice") the resulting market order would be a harmonious one (what Mandeville called "public benefit"). His writings, especially the delightful essay "The Fable of the Bees" (1714), were considered scandalous by his mercantilist contemporaries because he argued that self-interest could produce a more harmonious social order than the high-minded interventions of politicians or church leaders. In an essay written in 1723 Mandeville made some very suggestive remarks about the greater productiveness of the division of labor and the harmony of the market. His work may well have influenced Adam Smith when he came to write the Wealth of Nations later in the century:

"The greater the Variety of Trades and Manufactures, the more operose they are, and the more they are divided in many Branches the greater Numbers may be contain'd in a Society without being in one another's way, and the more easily they may be render'd a Rich, Potent and Flourishing People." Bernard Mandeville

The early Greek origins of the idea of a harmonious spontaneous order is discussed by Friedrich Hayek in "Cosmos and Taxis," Law, Legislation and Liberty: A New Statement of the Principles ofJustice and Political Economy. Vol. I: Rules and Order (University of Chicago Press, 1973), pp. 35-54, and "Dr. Bernard Mandeville," in New Studies in Philosophy, Politics, Economics and the History of Ideas (University of Chicago Press, 1978), pp. 249-66. The extent of Mandeville's support for laissez-faire is discussed by Jacob Viner, "Introduction to Bernard de Mandeville, A Letter to Dion (1732)," in The Long View and the Short: Studies in Economic Theory and Policy (Glencoe, IL: Free Press, 1958), pp. 332-42; Nathan Rosenberg, "Mandeville and Laissez-Faire," Journal of the History of Ideas 24, 1963, pp. 183-96; Alfred F. Chalk, "Mandeville's Fable of the Bees; A Reappraisal," Southern Economic Journal 33, 1966, pp. 1-16; Albert Schatz, "Bernard de Mandeville (Contribution à l'étude des origines du libéralisme économique)," *Vierteljahrschrift für Sozial- und Wirtrschaftsgeschichte 1, 1903, pp. 434-80; and Albert Schatz, L'Individualisme économique et social. Ses origines. Ses evolution. Ses formes contemporaines (Paris: Armand Colin, 1907), pp. 61-79. On more general aspects of Mandeville's thought, see Hector Monro, The Ambivalence of Bernard Mandeville (Oxford: Clarendon Press, 1975); Thomas A. Horne, The Social Thought of Bernard Mandeville: Virtue and Commerce in Early Eighteenth Century England (New York: Columbia University Press, 1978); and H. T. Dickinson, "The Politics of Bernard Mandeville," in Mandeville Studies: New Explorations in the Art and Thought of Dr. Bernard Mandeville (1670-1733) (The Hague: Martinus Nijhoff, 1975), pp. 80-97.

One of the classic formulations in the nineteenth century of the theory of the harmony of interests can be found in Jean-Baptiste Say's 1803 Treatise on Political Economy (New York: Augustus M. Kelly, 1964). This work is not only a brilliant economic treatise but also a sophisticated attempt to understand the social order of a free market system. Say was deeply influenced by Adam Smith's Wealth of Nations and was one of the founders of the theory of industrialism which was more fully developed by his radical libertarian follower Charles Comte, Charles Dunoyer, and Augustin Thierry in the 1810s and 1820s.

Say

The aspect of Say's thought that concerns us here is aconsequence of his law of markets, an invaluable insight concerning the very nature of the market process. As it is often confusingly interpreted, it simply states that supply creates its own demand. In this crude form Say's Law cannot stand up to the test of empirical reality. However, when this law is restated in the following way it becomes more comprehensible and meaningful: production, understood as a series of exchanges through time, will create its own demand given a certain amount of price flexibility (i.e., a network of freely adapting relative prices). Only when Say's Law is understood in this manner does it make sense to talk about supply creating its own demand and markets clearing. Say did not believe that markets would clear if the market system of prices was interfered with. Such interference distorts the smooth flow of social knowledge contained in a system of changing relative prices. As Friedrich Hayek has shown, prices supply important information which links the knowledge and ability of entrepreneurs to produce with the needs and ability of widely scattered consumers to pay. On the connection between free pricing and the transmission of knowledge, see F.A. Hayek, "Economics and Knowledge," in Individualism and Economic Order (University of Chicago Press, Midway Reprint, 1980) and Thomas Sowell, Knowledge and Decisions (New York: Basic Books, 1980).

In order to allow the smooth articulation of supply and demand Say called for an economic system of untrammelled laissez faire. When state power intervenes to prevent this articulation of supply and demand, the basis is laid for the creation of social conflict and the mismatching of economic and social aspirations with investment and production. Thus Say's Law is critically important to Real Liberal social theory because it forms the core of the theory of social and economic cooperation and integration via the free market. Out of this integrating function of the market comes the Real Liberal's conviction that free exchange and production, based on the idea of the harmony [p. 3] of interests of the market's participants, is the vital prerequisite for peace and prosperity.

Bastiat

The much maligned French liberal economist, Frederic Bastiat (1801-50), shared Say's view that the social and economic interests of all groups, in the absence of intrusions of violence (whether by the state or by private individuals) are compatible and ultimately in basic harmony. The harmony of individual interests and the destructive consequences of state intervention were clearly and wittily set forth in Bastiat's more popular works, such as the aptly named Economic Harmonies (Princeton, NJ: D. Van Nostrand, 1964), as well as in his political activities with the French Free Trade Association and its weekly paper, Libre-echange. In an address to the French Free Trade Association, Bastiat made the opposition between the peaceful order of the market and the violence of state intervention quite explicit.

"What kind of order can exist in a society where each industry, aided by the law and public force, looks for success in the oppression of all the others... It disturbs the peace between people and breaks the ties which unite them."

"The State is the great fiction according to which everyone tries to live at the expense of everyone else." - Frédéric Bastiat

Another French liberal, Charles Coquelin, identified the only means whereby peace and order could be maintained. If everyone abjured the use of force and fraud the natural cohesiveness and productivity of the market would operate to everyone's advantage. This did not mean that individuals had to have identical interests before this coordinating function of the market would begin to function. In fact the opposite was the case. The market works well because of the great differences in individual tastes and needs. The division of labor, the principle of comparative advantage, and Mises's "Law of Association" (which we have mentioned in a previous issue) mean that the market flourishes best with diversity.

"All individuals, when they restrict themselves to the limits defined by justice or rights and when they reject the use of force or fraud, contribute to the creation of a common order and even to a common interest, without really being aware of it." (Coquelin, "Harmonie industrielle," Dictionnatre de l'économie politique, vol. 1, p. 853.)

Bastiat's economic writings can be found in a modern edition edited by Florin Aftalion: Frederic Bastiat, Oeuvres economiques (Paris: Presses Universitaires de France, 1983). Bastiat's thought and political activity is the subject of a more detailed examination in George C. Roche III, Frederic Bastiat: A Man Alone (New Rochelle, New York: Arlington House, 1971) and Dean Russell, Frederic Bastiat: Ideas and Influence (Irvington-on-Hudson, NY: The Foundation for Economic Education, 1969). On the French free trade movement, see Bastiat, Cobden et la Lique: ou l'agitation anglaise pour la liberté du commerce (Paris: Guillaumin, 1845) and Paix et liberté, ou le budget republicain (Paris: Guillaumin, 1849). Also the many articles in the Dictionnaire de l'économie politique, especially A. Clément, "Bastiat" vol. 1, pp. 145-48; Joseph Garnier, "Cobden" vol. 1, pp. 388-89; Gustave de Molinari, "Liberté des échanges" vol. 2, pp. 445-49; Molinari, "Liberté du commerce," vol. 2, pp. 49-63. A guide to the older literature on the history and theory of the nineteenth century free trade movement can be found in Georg Jahn, "Freihandelslehre und Freihandelsbewegung," Handwörterbuch der Staatswissenschaften (Jena: Gustav Fisher Verlag, 1927), ed. L. Ester et al., vol. 4, pp. 354-71.

Mill

The dichotomy between free trade and peace on the one hand, and intervention and war on the other, was a central concern of most of the major nineteenth century classical liberals. This thesis is well documented in Edmund Silberner, The Problem of War in Nineteenth Century Economic Thought (Princeton University Press, 1946), trans. Alexander H. Krappe, where the writings of Thomas Malthus, David Ricardo, James Mill, John Ramsay MacCulloch, John Stuart Mill, Jean-Baptiste Say, Frédéric Bastiat, and Gustave de Molinari are discussed. The liberal hostility to war is forcefully shown in the words of James Mil, one of the most radical of the English classical liberal economists:

"To what baneful quarter, then, are we to look for the cause of the stagnation and misery which appear so general in human affairs? War is the answer. There is no other cause. This is the pestilential wind which blasts the prosperity of nations. This is the devouring fiend which eats up the precious treasure of national economy, the foundation of national improvement, and of national happiness." James Mill

[p. 4]

James Mill was responding to the Napoleonic Wars and some scholars have recently confirmed his view that war diverted wealth from productive pursuits and thereby slowed down industrial expansion. See Jeffrey G. Williamson, "Why Was British Growth So Slow During the Industrial Revolution?" Journal of Economic History, 1984, XLIV, 3, pp. 687-712. The wars also prompted many others in England to reassess their attitudes towards warfare as J. E. Cookson shows in The Friends of Peace: Anti-War Liberalism in England 1793-1815 (Cambridge University Press, 1982). On the French view of the peaceful nature and consequences of free trade, see the articles by Gustave de Molinari, "Paix-Guerre" and "Paix" (Sociétés et Congrés de la) in Dictionnaire de l'économie politique, cited above, vol. 2, pp. 307-15.

Cobden

There is probably no more important tenet in the Real Liberal doctrine than the causal relationship between the unhampered market system and international free trade, and the peaceful relations among nations which result from it. This linking of peace and free trade is nowhere more clearly stated than in the writings of Richard Cobden, usefully collected in Political Writings (New York: Garland, 1973), 2 volumes, and Speeches on Questions of Public Policy, ed. John Bright and J. E. Thorold Rogers (New York: Kraus Reprint, 1970). Richard Cobden and John Bright are best remembered for being the most famous agitators for free trade in nineteenth century England. Cobden was not only a talented businessman, a successful politician, and an organizational genius, but he was also a profound economic and social analyst, a brilliant critic of imperialism, and an indefatigable advocate of free trade. He and John Bright came to public attention during the bitter, but ultimately successful, campaign against the Corn Laws (the agricultural protection tariff) through their brilliant organizational efforts as leaders of the Anti-Corn Law League. In addition, Cobden's analysis of the beneficiaries of agricultural protection led him to study the power structure which existed in England at the time, a study that has many important insights for libertarian class analysis.

Cobden also directed his attention to questions of foreign policy. His opposition to the expanding British Empire led to insights in the libertarian theory of imperialism. He was also influential in the National Freehold Land Society, which, along with the trade unions of the period, helped raise funds for workers to own real property (a condition for voting in the restricted and corrupt franchise of the time) in order to increase the liberty-oriented voting forces. For more about Cobden's views on foreign policy, see J. A. Hobson, Richard Cobden: The International Man (New York: Barnes and Noble, 1968).

Cobden's influence reached both America and France (where he influenced Bastiat and the French Free Trade League) and his name was synonymous with free trade for decades. His rallying cry was "Peace, Retrenchment, and Reform." By retrenchment Cobden meant that the Empire should be abandoned, an action that he believed would lead to massive cuts in government spending and the ending of sinecures for the powerful landed classes. Cobden believed in a policy of "Little England." In other words, he and his free trade followers knew that prosperity depended not on the Empire and its military accoutrements, but on making England the "workshop of the world." This policy called for a dependence on thrift, industry, and above all on international free trade. Cobden's colleague, John Bright, is well treated by G. M. Trevelyan's The Life of John Bright (London: Constable, 1913) and the contributions of other members of the so-called Manchester School can be found in Free Trade and Other Fundamental Doctrines of the Manchester School, ed. Francis W. Hirst (New York: Augustus M. Kelly, 1968).

Atkinson

In the United States Cobden's counterpart in the struggle for Free Trade and against imperialism was Edward Atkinson. This laissez faire businessman was a key figure in the free trade movement and was also a tireless leader of the important Anti-Imperialist League which opposed the Spanish-American War in particular and American imperialism in general. Atkinson's life and work is covered by Harold F. Williamson, Edward Atkinson: The Biography of an American Liberal, 1827-1905 (New York: Arno Press, 1972).

Sumner

An important ally of Atkinson was William Graham Sumner whose "The Conquest of the United States by Spain" and "The Fallacy of Territorial Extension" in War and Other Essays (New Haven: Yale University Press, 1911) are classic arguments on behalf of free trade and against militarism, imperialism and territorial expansion. In keeping with the Real Liberal tradition, Sumner believed that open borders, a free and industrious population, savings and investment, and international trade make a prosperous society— not the building of military might, standing armies, intervention in other countries' affairs, and seizure of foreign territory. On the question of free trade, Sumner believed that all intervention by the state amounted to nothing more than direct or indirect expropriation. In Europe, those who expropriated the justly and peacefully acquired wealth of the producers were an alliance of the monarchy, the aristocracy, the military, and the bureaucracy. In America it was the "plutocracy." See "Liberté des échanges," in Nouveau Dictionnaire d'économie politique (Paris: Guillaumin, 1892), ed. Leon Say and Joseph Chailley, vol. 2, pp. 138-66.

Sumner's solution to the problem of protection and war was [p. 5] the same as Richard Cobden's— a massive cutback in the size and functions of the state in order to allow the greatest scope to peaceful industry.

Sumner's essays are collected in War and Other Essays (New Haven: Yale University Press, 1911), ed. Albert G. Keller; What the Social Classes Owe To Each Other (New Haven: Yale University Press, 1925), ed. Albert G. Keller; and Essays of William Graham Sumner, 2 vols., cited above.

"I maintain that the way to minimize the dangers to democracy, and from it, is to reduce to the utmost its functions, the number of its officials, the range of its taxing power, the variety of its modes of impinging on the individual, the amounts and range of its expenditures, and, in short, its total weight."

Mises

The classical liberal belief in the natural harmony of the free market found one of its most sophisticated supporters in the great twentieth century Austrian economist, Ludwig von Mises. In one of his earlier political works (1919), after experiencing the catastrophe of the First World War, Mises argues that imperialism and protectionism are the main barriers to eternal peace. Mises repeatedly returned to this theme in his later writings, especially in Socialism: An Economic and Sociological Analysis (Indianapolis: Liberty Classics, 1981), where he contrasts the peaceful market with the disruption and warlike tendancies of socialism, and in The Free and Prosperous Commonwealth: An Exposition of the ideas of Classical Liberalism (Princeton, NJ: Van Nostrand, 1962), trans. Ralph Raico, ed. ArthurGoddard, where he outlines a pacifist "Liberal Foreign Policy," pp. 105-154.

"He who wants to prepare a lasting peace must, like Bentham, be a free-trader and a democrat and work with decisiveness for the removal of all political rule over colonies by a mother country and fight for the full freedom of movement of persons and goods. Those and no others are the preconditions of eternal peace." Ludwig von Mises

Perhaps the most valuable contribution Mises has made to the development of a classical liberal social theory is his analysis of the exact opposite of everything he believed in. Since he lived through a period of history which witnessed the coming to power of socialism and the almost universal acceptance of intervention as a policy tool, it is not surprising that he developed a theory which would explain the nature of these new anti-market societies and the disruptions and disharmonies they created. In The Clash of Group Interests and Other Essays (New York: Center for Libertarian Studies, 1978) Mises shows that not only are social and economic groups harmonious under a system of private property and the free market, but that is only government action that creates any group conflict. Like James Mill, Richard Cobden, and William Graham Sumner, Mises argues that the state in fact creates classes (he used the term caste), solidifies their existence, and pits those favored with access to state power and privilege against those not so favored.

Interventionism

Once class begins to disrupt the peaceful operations of the free market a dynamic process is set in motion with leads to further interventions by the state. Mises calls this process "interventionism" and his theory of interventionism is explored in the essay "The Middle of the Road Leads ot Socialism," in Planning For Freedom (South Holland, IL: Libertarian Press, 1962). According to Mises, each intervention in the voluntary and harmonious interactions of market participants leads to unintended, deleterious economic and social consequences, which in turn demand further interventions to "correct" the new problem ad infinitum. Mises clearly saw that these interventions would continue until a comprehensive, authoritarian system of control was finally established. Thus, interventionism disrupts the harmony of the market, leading to the command economy or, as Mises termed it, the Zwangswirtschaft.

Given the massive state intervention and the resulting conflict and disruption we have witnessed in the twentieth century, Mises's theory of interventionism is of the utmost importance. With his theory we can understand the social and economic dynamics of government intervention, in particular his insight that government intervention is inherently unstable, requiring more and more controls and regulations in order to overcome the disturbing consequences of previous interventions, and the related contention that only in a fully free market can steady and harmonious economic development take place. We will return to Mises's theory of interventionism, the antithesis of harmony and prosperous market activity, in part four of "The Basic Tenets of Real Liberalism," entitled "Interventionism, Social Conflict and War."

The Basic Tenets of Real Liberalism by David M. Hart and Walter E. Grinder. Part IV: Interventionism, Social Conflict, and War.↩

HSR vol. 2 , no. 4 (1985), pp. 1-5.

Editor's Introduction

In this issue of the Humane Studies Review we continue some of the themes we developed in the previous issue, in particular that of government intervention. Following the great Austrian economist and classical liberal Ludwig von Mises, we argue that once the government begins intervening in the economy the inevitable failure of these interventions leads to demands for additional government measures to correct the original ones. The net result of gradually increasing the amount of intervention in the economy over many years is as economic system which Mises termed "interventionism". We will briefly describe what Mises meant by this term, how various forms of intervention have been the norm of history , and how political control of the economy creates deep-seated conflict and antagonism.

Part IV: Interventionism, Social Conflict, and War.

Recommended Reading.

Ludwig von Mises, The Clash of Group Interests and Other Essays (New York: Center for Libertarian Studies, 1978).

Ludwig von Mises, "The Middle of the Road leads to Socialism," in Planning for Freedom (South Holland, IL: Libertarian Press, 1962).

Ludwig von Mises, "War and the Economy, in Nation, State, and Economy (New York University Press, 1983), trans. Leland B. Yeager.

Murray N. Rothbard, Power and Market (Kansas City: Sheed Andrews and McMeel, 1977).

 

In the previous issue of the Humane Studies Review we showed that the belief in the natural harmony of the free market has been part of the liberal tradition for centuries. Equally ancient is the idea that intervention by the state disrupts social peace and destroys individual wealth. One of the most sophisticated supporters of this idea of state disruption is the Austrian economist Ludwig von Mises. In a short but important essay found in The Clash of Group Interests and Other Essays (New York: Center for Libertarian Studies, 1978) Mises argues that social and economic groups relate harmoniously and peacefully only under a system of private property and the free market.

However, Mises goes further than many other liberals with his view that it is only government action that creates any group conflict which does exist. By creating a mechanism whereby those with access to state power and privilege can benefit at the expense of those not so privileged, the state also creates classes (or "caste" as Mises called them to avoid confusion with Marxist ideas of class). Mises's concept of the radical opposition between the state and economy is used by Murray Rothbard very effectively to show that in every area of economic life intervention by the state is disruptive, inefficient, and the cause of class conflict. See Murray N. Rothbard, Power and Market (Kansas City: Sheed Andrews and McMeel, 1977). We will return to the important question of class in a future issue, after our discussion of Mises's theory of interventionism.

Mises's key insight, which forms the basis of his theory of interventionism, is the following: once the state begins to disrupt the peaceful operations of the free market, a dynamic [p. 2] process is set in motion which leads to further interventions by the state. According to Mises, each intervention in the voluntary and harmonious interactions of market participants leads to unintended, deleterious economic and social consequences, which in turn demand further interventions to "correct" the new problem ad infinitum. Mises calls this process "interventionism" and his theory of interventionism is explored in the essay "The Middle of the Road Leads to Socialism," in Planning for Freedom (South Holland, IL: Libertarian Press, 1962).

Price Controls

An example which is commonly given to illustrate this process is price control. If the state attempts to artificially lower the price of a commodity, say grain, below the market price the interventionist dynamic is set in motion. First of all, producers have less incentive to supply the good because they cannot be adequately recompensed for their troubles. To the extent that production does continue, there is less profit to invest in expansion or improving yields. Secondly, consumers are presented with a lower-priced commodity and may attempt to increase their consumption of the good. The result of reduced supply and increased demand is enormous pressure for black markets, corruption of regulatory officials, and other measures to get around the restrictions. If the state wishes to maintain its policy of low grain prices (as many African and Latin American states do) it must either "eliminate" black marketeers and enforce price controls more stringently (as the Soviet government did in the early period of "war communism" when they literally eliminated private producers for selling on the black market), or it must force farmers to expand supply. Many states achieve the latter by taking over the production of food so they can ensure that production is not "diverted" or curtailed in response to prices. The final step in this process is the "collectivization" of agriculture.

Kinds of Socialism

Mises clearly saw that interventions would continue until a comprehensive, authoritarian system of control was finally established. Depending upon the context in which he was working, Mises coined the following terms to describe the end-product of the process of interventionism. The most general term he used was "command economy" or Zwangswirtschaft which emphasized the coercive aspects of interventionism. Because interventionism has many features in common with fully-fledged socialism Mises also used the term "state socialism," thus stressing the primary role of the state in directing the economy. A third expression for the same phenomenon is "war socialism," not surprising given the fact that under cover of so-called war measures the state massively increased its power over the economy.

Mises observed the acceleration of interventionist measures personally during the catastrophe of the First World War and shortly afterwards wrote an important analysis of the phenomenon in "War and the Economy," in Nation, State, and Economy (New York University Press, 1983), trans. Leland B Yeager. Mises observed that:

War socialism was only the continuation at an accelerated tempo of the state-socialist policy that had already been introduced long before the war. (p. 176)

An interesting discussion of the attempt by Mises and others to come to terms with the problem of interventionism can be found in Gerold Ambrosius, Zur Geschichte des Begriffs und der Theorie des Staatskapitalismus und des staatsmonopolistischen Kapitalismus (Tübingen: J. C. B. Mohr, 1981). Some scholars, unaware of Mises's contribution, have attempted to explain the problem in other ways. The idea of "organized capitalism" is the topic of Organisierter Kapitalismus, ed Heinrich A. Winkler (Göttingen: Vandenhoek und Ruprecht, 1974). The problem of this approach is that the question of who organizes capitalism is not properly examined. The private organization of business is, of course, necessary and does not disrupt the economy. Only the organization of business by and through the state is disruptive and unfair to those who are excluded or who have to pay for another's privileges. The value of Mises's analysis is that he understands the market and therefore never makes this fundamental mistake.

The growth of the interventionist state accelerated markedly during the first half of the twentieth century, the watershed being the massive interventions undertaken by all states during the First World War. It was during this period that the main forms of modern interventionism developed: the war economics of the American and Western European nations, the Fascist regimes of inter-war Germany and Italy, the semi-military economies [p. 3] of Latin America and inter-war China and Japan, the various attempts to establish communism, and the modern welfare states with which most of us are familiar.

Mises's theory of interventionism can be used very effectively to explain the origin and operation of this phenomenon. It is important for classical liberals to develop Mises's theory further and to be able to use the theory to analyze in detail the ways in which interventionism has historically appeared. Although the interventionist tide now may be beginning to turn, the interventionist state continues to exist and it is vital to understand how it arose, how it functions, and how the inevitable crises it engenders can be used to bring about change. We only have space to discuss a few manifestations of the interventionist state in this essay, but we hope that the books and articles we suggest will lead the reader to pursue the topic further.

The Command Economy

The Zwangswirtschaft has existed in a relatively pure form in the economic system established by the Bolsheviks in the Soviet Union. Roger Pethybridge and Paul Craig Roberts have convincingly shown how the catastrophic economic failures of Bolshevik Russia inevitably arose out of the experiments in war communism and the attempt to exterminate the market by force. It is interesting to note that the Bolsheviks used the example of the German war economy (war socialism in Mises's terminology) for their own economy. Since Marx had not described how the socialist economy would work and since the best model Lenin could come up with was the Post Office it is not surprising that the Bolsheviks turned to German militarism as an example of functioning state control of the economy. See Roger Pethybridge, The Social Prelude to Stalinism (London: Macmillan, 1977) and Paul Craig Roberts, "War Communism: A Re-examination," Slavic Review, June 1970, vol. 29, no. 2, pP. 238-61.

A similar and perhaps even bloodier experiment in abolishing the market took place in Cambodia after 1975. On the extremes to which Pol Pot and the Khmer Rouge went in following their anti-market, interventionist logic, see François Ponchaud, Cambodia lear Zero (Harmondsworth: Penquin, 1978) and William Shawcross, The Quality of Mercy: Cambodia, Holocaust, and Modern Conscience (London: Andre Deutsch, 1984).

The extensive militarization of German industry and society which took place during the First World War is discussed in Ludwig von Mises, Nation, State, and Economy: Contributions to the Politics and History of Our Time, trans. Leland B. Yeager (New York University Press, 1983); Gerald D. Feldman, Army, Industry, and Labor in Germany 1914-1918 (Princeton University Press, 1966); and Martin Kitchen, The Silent Dictatorship: The Politics of the German High Command under Hindenburg and Ludendorff 1916-1918 (London: Croom Helm, 1976).

The phenomenal growth of the interventionist state before and during the First World War is not confined to the continent of Europe. The American experience is well covered by James Gilbert, Designing the Industrial State: The Intellectual Pursuit of Collectivism (Chicago: Quadrangle Books, 1972); Gabriel Kolko, The Triumph of Conservatism: A Re-Interpretation of American History, 1900-1916 (Chicago: Quadrangle Books, 1963); James Weinstein, The Corporate Ideal in the Liberal State, 1900-1918 (Boston: Beacon Press, 1968); and Stephen Skowronek, Building a New American State: The Expansion of National Administrative Capacities, 1877-1920 (Cambridge University Press, 1982).

American Socialism

On the militarization of the American economy, see Murray N Rothbard, "War Collectivism in World War "1, in A New History of Leviathan: Essays on the Rise of the American Corporate State, ed. Ronald Radosh and Murray N. Rothbard (New York: E. P. Dutton, 1972); and Robert D. Cuff, The War Industries Board: Business-Government Relations During World War One (Baltimore: John Hopkins University Press, 1973). A more ambitious survey and synthesis of the problem of the militarization of the economy which has considerable relevance for the US. in this period is William H.McNeil, The Pursuit of Power: Technology, Armed Force, and Society since A. D. 1000 (University of Chicago Press, 1982).

War Socialism

German fascism which developed during the 1930s and 1940s is another textbook example of a command economy. It is especially important for students of Austrian economics because Mises's experience of the Nazi takeover and his observation of the German economy led him to develop the theory of interventionism in the first place. In a similar fashion, the Bolshevik attempt to eliminate the market during the period of war communism led Mises to question the possibility of rational economic calculation under socialism. A good place to begin unravelling the complexities of the German fascist economy is the excellent collection of essays in Fascism: A Reader's Guide. Analyses, Interpretations, Bibliography (Harmondsworth: Penquin, 1982), ed. Walter Laqueur, especially the article by Alan S. Milward, "Fascism and the Economy," pp. 409-53. Also recommended is Milward's War, Economy and Society, 1939-1945 (University of California Press, 1979) for the general problem of the take-over of the economy by the state during the war.

The nature of the fascist economy raises some important questions about the general problem of interventionism. Some conservatives argue that Fascism is a unique occurance, having more to do with Hitler's personality than with government intervention in the German economy. Others argue that Fascism [p. 4] is just one kind of government intervention which was not unique to Germany in the 1930s and which therefore could be repeated in slightly different forms under the right circumstances. A contemporary but still useful interpretation of fascist interventionism which reveals the relationship between big business and the fascist state is given by Robert A. Brady, The Rationalization Movement in German Industry: A Study in the Evolution of Economic Planning (University of California Press, 1933); The Spirit and Structure of German Fascism (London: Victor Gollancz, 1937): and Business as a System of Power (New York: Columbia University Press, 1943).

For a more recent discussion of this question, see Arthur Schweitzer, Big Business in the Third Reich (Bloomington: Indiana University Press, 1964) and the debate between Henry A. Turner and Dirk Stegman: Stegman, "Zum Verháltnis von GroBindustrie und Nationalsozialismus 1930-1933. Ein Beitrag zur Geschichte der sog. Machtergreifung," Archiv für Sozialgeschichte, vol. 13, 1973, pp. 399-482; Turner, "GroBunternehmertum und Nationalsozialismus 1930-1933," Historische Zeitschrift, vol. 221, no. 1, 1975, pp. 18-68; and Stegman, "Antiquierte Personalisierung oder sozialökonomische Faschismum-Analyse? Eine Antwort auf H. A. Turners Kritik an meinen Thesen zum Verhältnis von Nationalsozialismus und GroBindustrie vor 1933," Archiv für Sozialgeschichte, vol. 27, 1977, pp. 275-296.

While the European economies were becoming more and more interventionist during the inter-war period a similar process was taking place in America with FDR's New Deal. For a penetrating and disturbing analysis of the growth of a command economy under President Roosevelt, see As We Go Marching (New York: Free Life Editions, 1973) by the "Old Right" libertarian John T. Flynn. This book first appeared in 1944 and, like his contemporary Robert Brady, Flynn draws realistic and frightening parallels between the economic systems created by German and Italian fascism and the economic developments taking place in America during the 1930s. In particular Flynn analyzes the movement towards centralized decision-making and the way in which the state prevented private businesses from conducting their own affairs. Roosevelt explicitly modelled the interventionist New Deal measures on the experience of the First World War and even re-employed the same people. This aspect of the New Deal is discussed by William E. Leuchtenburg, "The New Deal and the Analogue of War," in Change and Continuity in Twentieth Century America, ed. John Braehen, Robert Brenner, and Everett Walters (New York: Harper and Row, 1966).

State Socialism

One of the most disturbing features to emerge from the Second World War was a group of industrial interests which benefited from the militarization of the economy. Instead of producing and selling for the market, these firms produced for and sold to the state. The resources to pay for military products were diverted away from individual consumers and the firms which peacefully and productively supplied them. Apart from being an enormous financial burden the Military-Industrial Complex (to use President Eisenhower's expression) was able to influence government policy and thereby entrench its privileges and perpetuate the distortion of the economy. Two recent treatments of the cosy alliance between the state and certain industrial interests are by Benjamin Franklin Cooling, War, Business, and American Society: Historical Perspectives on the Military-Industrial Complex (Port Washington, NY: Kennikat, 1977) and War, Business, and World Military-Industrial Complexes (Port Washington, NY: Kennkikat, 1981).

The interventionist state has gone further in Western Europe than in the United States. The legacy of war, fascism, large and well-organized socialist parties, and a tradition of statist intervention has meant that the freedom allowed business has been much less that found in America. The European problem must be seen in the light of the extraordinary events of the last hundred years. The important inter-war years are covered by Charles S. Maier, Recasting Bourgeois Europe: Stabilization in France, Germany, and Italy in the Decade after World War I (Princeton University Press, 1981), especially the section "Corporative State in Corporatist Europe," pp. 545-78. The tradition of state intervention in France is discussed by Richard F. Kuisel, Capitalism and the State in Modern France: Renovation and Economic Management in the Twentieth Century (Cambridge University Press, 1983).

The problems facing the victorious powers at the end of the Second World War were similar to those of the First. Politicians in both cases were keen not to allow the market to usurp their power and influence. The debate begun by Maier raises important questions. See Charles S. Maier, "The Two Postwar Eras and the Conditions for Stability in Twentieth-Century Western Europe," American Historical Review, April 1981, vol. 86, no. 2, pp. 327-52, and the comments by Schuker, Kindleberger, and Maier's reply, pp. 353-67.

[p. 5]

Since the Second World War, the state has been the focus of a constant battle between interest groups for political control. Political control or influence is vital for unions, public servants, farmers, and protected industries such as steel and aerospace to gain privileges or to protect their existing ones. On the way interest group politics has distorted the European economies, see Organizing Interests in Western Europe; Pluralism, Corporatism, and the Transformation of Politics, ed. Suzanne Berger (Cambridge University Press, 1983); Phillipe C. Schmitter, "Still the Century of Corporatism," Review of Politics, 1974, vol. 36, p. 85-128; and Planning, Politics, and Public Policy: The British, French, and Italian Experience, ed. Jack Hayward and Michael Watson (Cambridge University Press, 1975).

Socialism

Unlike that in the U.S.A. where economic life has been largely independent of the state, industrial development in Europe has gone ahead with considerable state intervention and this legacy remains quite powerful to this day. The background to state control and interference is provided by Barry Supple, "The State and the Industrial Revolution, 1700-1914," in Fontana Economic History of Europe, ed. Carlo M. Cipolla (1973), vol. 3; and The State and Economic Growth, ed. Hugh G.J. Aitken (New York: Social Science Research Council, 1959). In the German case, the state has always assumed a privileged position in the economy as Gerold Ambrosius, Der Staat als Unternehmer: offenliche Wirtschaft und Kapitalismus seit dem 19, Jahrhundert (Götingen: Vandenhoeck und Ruprecht, 1984) shows. The extent of modern intervention is clearly demonstrated in Big Business and the State: Changing Relations in Western Europe, ed. Raymond Vernon (London: Macmillan, 1974) and Andrew Shonfeld, Modern Capitalism: The Changing Balance of Public and Private Power (Oxford University Press, 1969).

Armed with Mises's theory of interventionism and some knowledge of twentieth century American and European command economies, one is in a position to come to grips with the thorny problem of class. Mises clearly understood that there was an element of truth in the Marxist claim that modern societies were conflict-ridden. The apparent paradox of a classical liberal theory of class analysis is resolved if we return to Mises's argument in The Clash of Group Interests and Other Essays. Here Mises distinguishes between the Marxian and the liberal idea of exploitation. Whereas Marx saw conflict in the very nature of exchange and wage-labor, Mises and other classical liberals see class and class conflict as the inevitable result of the politicization of market relations. They reject the Marxist idea of exploitation utterly and replace it with their own unique interpretation based on individual property rights. Thus there is a liberal theory of class conflict, the theory and history of which we will discuss in the next issue.

The Basic Tenets of Real Liberalism by David M. Hart and Walter E. Grinder. Part VI Continued: Interventionism, Social Conflict and War↩

HSR vol. 3, no. 1 (1986), pp. 1-7.

Editor's Introduction

In the last issue of the Humane Studies Review we introduced Ludwig von Mises's crucial concept of interventionism. This led to a discussion of some important forms that the interventionist state has taken: organized capitalism, the command economy, war socialism, fascism, state socialism, and the welfare state. In this issue we return to the general topic of interventionism to expand on Mises's insight that class conflict is the result of government interventions in the economy and the granting of political privileges.

Most people associate "class analysis" with Marxism yet it is an irony of history that an earlier and more consistent theory of class and class conflict was developed by classical liberals in the eighteenth and nineteenth centuries. We will present a liberal theory of class based on Austrian economic theory in this issue and in the process show its priority and superiority to Marxist theories of class.

Part VI Continued: Interventionism, Social Conflict and War

We concluded the first section of "Interventionism, Social Conflict, and War" with the assertion that a classical liberal theory of class conflict existed and that it had an extensive pedigree. In this second section we will discuss the intellectual bankruptcy of the Marxist conception of class and the more consistent liberal approach that should replace it.

As we saw in the previous issue, when Mises's theory of interventionism is combined with some historical knowledge of twentieth-century American and European command economies one has a powerful framework in which to analyze the thorny problem of class. Mises clearly understood that there was an element of truth in the Marxist claim that modern societies were conflict-ridden. Marx saw conflict in the very nature of exchange and wage-labor. Those who benefited from ownership and wage-labor comprised one "class" and those whose surplus value was "expropriated" comprised the other. Since "capitalism" is exchange and production based on wage-labor, it was inevitable that Marx would condemn it as a system of exploitation of one class by another. For extracts on Marxist theories of class, see Classes, Power, and Conflict: Classical and Contemporary Debates, ed. Anthony Giddens and David Held (Berkeley: University of California Press, 1982) and Readings in Marxist Sociology, ed. Tom Bottomore and Patrick Goode (Oxford: Clarendon Press, 1983).

In the 100 years since Marx's death a considerable body of thought has been developed that uses the Marxist concept of class to analyze society. There is much of historical value in many of these works but they are [p. 2] severely handicapped by a fundamental misconception about class and the nature of exploitation. This misconception is obvious to classical liberals. Fortunately, in recent years an increasing number of Marxists has also begun to doubt the validity of the Marxist framework. One could almost say that Marxist class analysis has reached a crisis and that even within the Marxist framework the statist and oppressive implications of Marx's idea of exploitation are becoming obvious. Two authors in the Marxist tradition who are aware of this problem are Stuart Hal, "The State: Socialism's Old Caretaker," Marxism Today (November 1984, pp. 24-29) and Jean L. Cohen, Class and Civil Society: The Limits of Marxian Critical Theory (Amherst: University of Massachusetts Press, 1982).

Faced with the patent failure of their historical predictions, Marxists have had either to turn their backs on the real historical world or come to grips with the incoherence of their basic assumptions. For example, the predictions, so confidently made by Marx and others in the nineteenth century, concerning the inevitability of the proletarian revolution in the most advanced capitalist countries have repeatedly been confounded by events. The fact that the first revolution made in the name of Marx took place in Russia, one of the most economically backward nations in Europe, rather than in the industrially advanced nations of Germany or Great Britain with their well developed proletarian "class;" the fact that soldiers and peasants rather than factory workers were the backbone of the revolt; the fact that class conflict did not disappear in states ruled by Marxist parties but rather metamorphosed into new and particularly vicious forms of class rule, all suggest that Marxist theories of class are fundamentally flawed and either class as a concept must be abandoned or a new one developed to replace it. For some of the most cogent criticisms of Marxist theories of class and industrial development by non- Marxists see, Ernst Nolte, Marxismus und Industrielle Revoltion (Stuttgart: Klett-Cotta, 1983) and Thomas Sowell, Marxism: Philosophy and Economics (New York: Morrow, 1985.)

One of the best examples of a Marxist critique Marxist class analysis is Jean Cohen's recent work Class and Civil Society. Cohen has suggested that the major weakness in these theories is a misunderstanding by Marx of the nature of state power and its radically different mode of operation from that of a civil society (i.e., the voluntary society of the market).

It is this reduction of the state to a mere instrument of the ruling class that precludes the investigation of the internal dynamics of the political sphere and the nature of the power of those who occupy its ranks. The meagerness of Marxist analyses of the state can thus be attributed to an overextended and overburdened class concept.

The failure of Marxism, according to Cohen, is thus rooted in the very nature of Marxian class theory itself. Although Cohen is able to identify the most important failure of Marxist class theories of class, viz., the abandonment of what Cohen calls the "the rich opposition between the state and civil society" she quite unable to put forward anything convincing to replace it.

If the main thrust of Marxist theories of class and exploitation is seriously deficient and thus unable to explain adequately the struggles of the past or the present, then perhaps it would be wise to examine the origins of theories of exploitation and class to untangle the confusion that lies at its very heart. An examination reveals a forgotten alternative liberal theory of class that existed in the shadow of Marx's more famous body of thought. We will briefly examine the alternative, liberal notion of class and exploitation, which had its origins in England, France, and America in the late eighteenth and early nineteenth centuries. We will discuss Thomas Paine, Thomas Jefferson, and John Taylor in America; Thomas Hodgskin, John Wade, James Mill, and John Stuart Mill in Great Britain; and Jean-Baptiste Say, Charles Comte, and Charles Dunoyer in France, as examples of liberal writers who developed interesting ideas on class based on the fundamental liberal dichotomy of civil society vs. the state.

Although the classical liberal tradition rejects the Marxist idea of exploitation utterly, there is nevertheless a liberal theory of class conflict. This apparent paradox is resolved if we return to Mises's argument in The Clash of Group Interests and Other Essays (New York: The Center for Libertarian Studies, 1978). The defining characteristic of class (or caste) for Mises is the use of coercion. Since the market is essentially peaceful and harmonious (on the natural harmony of the market, see Humane Studies Review, vol. 2, no. 3), the only possible source of conflict is the use or the threat of use of force to violate individual property rights. The violation of property rights may occur on an individual basis by petty criminals, but this is usually sporadic and not normally organized. A more insidious form of property-rights violation occurs when the state becomes the tool of vested interests. When this happens, as it all too frequently does, society is divided into two [p. 3] antagonistic classes, those who benefit from state interventions and privileges and those who lose out. Transactions become highly politicized and the mutually beneficial exchanges of the market are replaced by favor-seeking, lobbying, and a system where the gain of one really is the loss of another.

Mises was not the first to view classes in this non-Marxist light. The sixteenth-century French political philosopher Etienne de la Boétie pictured society as a pyramid with the monarch at the apex, the mass of peaceful producers at the base, and a middle group that benefited more from state privileges the closer they approached the monarch. On Boétie, see The Politics of Obedience, ed. Murray N. Rothbard (New York: Free Life Editions, 1975) and Humane Studies Review (vol. 1, no. 1, p. 3.).

Interesting insights into class were also made by various figures of the Scottish Enlightenment, among whose luminaries Adam Ferguson and John Millar practically originated the liberal theory of class and liberal sociological analysis of political society in their respective works: An Essay on the History of Civil Society (1767) and *The Origin of the Distinction of Ranks (1771). On the Scottish Enlightenment, see Humane Studies Review "An Outline of the History of Libertarian Thought: Part III, The Scottish Enlightenment" (vol. 2, no. 3, pp. 6-8). On the sociological approach of Adam Ferguson and John Millar see R Meek, "The Scottish Contribution to Marxist Sociology," in Economics, Ideology and Other Essays (London, 1967) and A Skinner, "Economics and History: The Scottish Enlightenment," Scottish Journal of Political Economy (vol. 12, 1965, pp. 1-22). More specifically on the Scottish contribution to class analysis, see Peter Calvert, The Concept of Class: An Historical Introduction (London: Hutchinson, 1982) and Goran Therborn, Science, Class and Society: On the Formation of Sociology and Historical Materialism (London: NLB and Verso, 1980).

During the American Revolution many revolutionaries came to the same conclusion about class conflict in their struggle against British imperial taxation and regulation. The best example is Thomas Paine. In his revolutionary tracts Common Sense (1776) and The Rights of Man (1791) Paine clearly distinguishes between the order and peace of "society" and the violence and exploitation of "the state," especially the monarchical form of the state, which he considered to have evolved out of conquest and military subjugation of the productive peasantry; He saw the important role of taxation as the conduit of exploitation, transferring resources from the taxpayers to the privileged elite who lived off them:

There are two distinct classes of men in the Nation, those who pay taxes and those who receive and live upon the taxes ... when taxation is carried to excess, it cannot fail to disunite those two, and something of this is now beginning to appear. "A Letter Addressed to the Addressers on the Late Proclamation (1792)" in The Writings of Thomas Paine, ed. M. D. Conway and C. Putnam (New York, 1906), vol. III, p. 55.

For Paine the "producing classes" were in a virtual state of war with the parasitical aristocracy, those who lived off hereditary privilege, sinecures, and other government sources of wealth. Paine's views on aristocracy and privilege are discussed in Eric Foner, Tom Paine and Revolutionary America (New York: Oxford University Press, 197 6), p. 96.

Following the French Revolution and in the immediate period of economic adjustment in the 1820s an unusual parallel development in the formation of liberal class analysis took place. In England, the United States, and France radicals developed theories of class and exploitation with some striking similarities. The radical Jeffersonians in America, the English individualists, who often have been wrongly identified with their contemporaries, the so-called "Ricardian socialists," and the radical liberals of Restoration France all developed critiques of aristocratic privilege that were based on a notion of class exploitation.

In the newly formed United States of America the Jeffersonian party was faced with a resurgence of interventionism organized by the Federalists. Opposed to tariffs and subsidies designed to protect domestic manufacturers, the Jeffersonian radicals formulated a theory of class to understand who was benefiting from the new legal privileges being enacted by the Federal Government. One of the best representatives of this radical Jeffersonian school is John Taylor of Caroline. Most historians have portrayed the Jeffersonians as hostile towards industry. They are presented as nostalgic supporters of native American agrarianism. A closer reading of their work shows that this traditional view is mistaken. What Jefferson and Taylor opposed was not industry itself but the state favors and privileges to industry that the Hamiltonians wanted to erect. On the debate about the extent of government power and intervention in the economy, see E. A. J. Johnson, The Foundations of American Economic Freedom: Government and Enterprise in the Age of Washington (Minneapolis: University of Minnesota Press, 1973). On the debate about industrialization and government support for industry see The Philosophy of Manufactures: Early Debates over Industrialization in the United States, ed. Michael Brewster Folsom and Steven D. Lubar (Cambridge, Massachusetts: The MIT Press, 1982).

John Taylor brilliantly exposed the new "aristocracy of paper and patronage," which had emerged in the wake of the new Federal Government, in his book An Inquiry into the Principles and Policy of the Government of the United States, ed. W. Stark (London: Routledge and Kegan Paul, 1950), especially in the chapter "Aristocracy":

Sinecure, armies, navies, offices, war, anticipation and taxes make up an outline of that vast political combination, concentrated under the denomination of paper and patronage. These, and its other means, completely enable it to take from the nation as much power and as much wealth, as its conscience or its no conscience will allow it to receive .... This catastrophe has already arrived in Britain .... The effect of opposite interests, one enriched by and governing the [p. 4] other, correctly follows its cause. One interest is a tyrant, the other its slave. Inquiry, pp. 64-65.

Discussions of Taylor's thought can be found in Gillis J. Harp, "Taylor, Calhoun, and the Decline of a Theory of Political Disharmony," Journal of the History of Ideas (1985, vol. 46, no. 1, pp. 101-120); and Duncan Macleod, "The Political Economy of John Taylor of Caroline," Journal of American Studies (1980, vol. 14, no. 3, pp. 387-406). The reassessment of the Jeffersonians economic thought can be best approached through Joyce Appleby's Capitalism and a New Social Order: The Republican Vision of the 1790s (New York University Press, 1984); Drew McCoy, The Elusive Republic: Political Economy in Jeffersonian America (Chapel Hill: University of North Carolina Press, 1980); and John F. Kasson, "The Emergence of Republican Technology," in Civilizing the Machine: Technology and Republican Values in America 1776-1900 (New York: Grossman Publishers, 1976).

The Jeffersonian tradition was continued somewhat later by the Jacksonian Democrats, in particular William Leggett. See the collection edited by Lawrence H. White, Democratick Editorials: Essays in Jacksonian Political Economy by William Leggett (Indianapolis: Liberty Press, 1984) and Social Theories of Jacksonian Democracy: Representative Writings of the Period 1825-1850, ed. Joseph L. Blau (New York: Haffner, 1947).

In Britain a similar analysis by radical liberals of post-revolution aristocracy was underway. Modern writers have interpreted the English radicals as essentially "Ricardian" in their analysis and so labelled them "Ricardian socialists." This is certainly a misnomer, especially for John Wade and Thomas Hodgskin. In an otherwise extremely useful book Noel W. Thompson, The People's Science: The Popular Political Economy of Exploitation and Crisis 1816-34 (Cambridge University Press, 1984) continues this confusion. Like so many others he is unable to comprehend that free market liberals could have a theory of class and exploitation.

The radical individualist Thomas Hodgskin, in The Natural and Artificial Right of Property Contrasted (Clifton, New Jersey: Augustus M. Kelley reprint, 1973; originally published 1832), gives a clear example of the application of the libertarian nonaggression principle to the acquisition and exchange of property. He also implies that those who benefit from "artificial" property rights, that is, by force and state privilege, comprise a class antagonistic to the producing class. The distinctlon is made even more explicitly by John Wade in both IThe Extraordinary Blackbook: An Exposition of the United Church of England and Ireland; Civil List and Crown Revenues; Incomes, Privileges and Power of the Aristocracy ...* (1819) and his magazine The Gorgon. In the August 8, 1818, issue of The Gorgon Wade identifies the following classes:

The different classes which we have mentioned (the upper and middling classes such as the aristocrats and the Commissioners of Taxes) are identified with corruption, and from a principle of self-preservation will resolutely oppose every attempt at Reform. Opposed and even incompatible, are arrayed the PRODUCTIVE CLASSES of society . .. who by their labours increase the funds o[ the community, as husbandmen, mechanics, labourers, etc; and are thus termed to distinguish them from the unproductive classes, as lawyers, parsons, and aristocrats; which are termed the idle consumers, because they waste the produce of the country without giving anything in return. To render our enumeration complete, we ought to notice the class of paupers and public creditors, and we shall then have mentioned all the elements, which form that strange compound, English society. Gorgon, Volumes 1-2, 1818- 1819 (New York: Greenwood Reprint Corporation, 1969), p. 90.

The basic error of most scholars who have dealt with these so-called "Ricardian socialists" is to consider their class analysis as the defining characteristic of a socialist and to ignore their strong belief in property and the free market.

Before moving on to the French contribution to liberal class theory, we should mention James and John Stuart Mill. James Mill's class analysis emerges from his distinction between "the People" and the aristocracy, or as he termed it, "the sinister interests." As with Paine and Wade Mill pits the two classes against each other in total combat. In an essay, "The State of the Nation," in The London Review, 1 (April 1835), he says,

The first class, Ceux qui pillent [those who pillage], are the small number. They are the ruling few. The second class, Ceux quz sont pillés [those who are pillaged], are the great number. They are the subject Many.

John Stuart Mill incorporated this class interpretation into his analysis of the natural constituency for the Reform Party in an essay on "Reorganization of the Reform Party" written in 1839. He defined the "Disqualified Classes," as he called them, as

All who feel oppressed, or unjustly dealt with, by any of the institutions of the country; who are taxed more heavily than other people, or for other people's benefit, who have or consider themselves to have, the field of employment for their pecuniary [p. 5] means or their bodily or mental faculties unjustly narrowed; who are denied the importance in society, or the influence in public affairs, which they consider due to them as a class, or who feel debarred as individuals from a fair chance of rising in the world; especially if others, in whom they do not recognize any superiority of merit, are artificially exalted above their heads: these compose the natural Radicals .... In Collected Works, vol. 6, ed John M. Robson (University of Toronto Press, 1982), p. 470.

Unfortunately, the disappointments and disillusionment with political activity that affected Philosophic Radicalism in the 1840s may have prevented the Mills from carrying their class analysis any further. The best source of information on the two Mills is Joseph Hamburger, Intellectuals in Politics: John Stuart Mill and the Philosophic Radicals (New Haven: Yale University Press, 1965). For the broader milieu in which class ideas were developing at this time, see Asa Briggs, "The Language of 'Class' in Early Nineteenth-Century England," in Essays in Labour History, ed. Asa Briggs and John Saville (New York: St Martin's Press, 1976) pp. 43-73.

Throughout the nineteenth century liberal writers argued that the state was the source of privilege and exploitation and therefore the origin of class conflict. The French liberals in particular were acutely aware of the state's exploitative function. Jean-Baptiste Say in the Traité d'économie politique (1803); Charles Comte in Traité de legislation (1826); Alexis de Tocqueville in L'ancien regime et la Revolution (1856); and Gustave de Molinari in L'Évolution politique et la Revolution (1884) made access to political power the most important criterion in the formation of class conflict This aspect of French liberal thought is discussed in Leonard P. Liggio, "Charles Dunoyer and French Classical Liberalism," Journal of Libertarian Studies (1977, vol. 1, no. 3, pp. 153-178) and David M. Hart, "Gustave de Molinari and the Anti-statist Liberal Tradition," Journal of Libertarian Studies (1981-82, vols. 5 and 6, nos. 3, 4, and 1).

It is worth spending some time on the French liberals both because they are unjustly neglected as theorists of class analysis and because of the extraordinary richness of their thought and the remarkable consistency with which they applied liberal principles to the development of their theory of society.

It is useful to begin with the economic theories of Say because he was an important catalyst in the revival of liberal ideas in the unsettled period between the fall of Napoleon and the 1830 revolution. Say established his reputation as the leading French political economist with the publication of his influential Traité d'économie politique. As far as the development of liberal class theory is concerned, the additions and changes that Say made for the second edition of 1814 and the third edition of 1817 are of great importance. The reason behind the development of Say's theory of class can be found in the traumatic historical events of the time. In the intervening decade and a half between the first and second editions of the Traité Say witnessed the massive economic interventionism and reckless militarism of Napoleon as well as the acceleration of industrialization in the northeast of France. He also witnessed the terrible recession that hit all of continental Europe and Great Britain as the economy slowly adjusted to the absence of wartime inflation and the demands of peacetime. In addition to the expanded edition of the Traité, Say's other important theoretical work is the Cours complet d'économie politique pratique (1828).

Having observed the interventionism of the militaristic Napoleonic state, Say was aware of the ways in which certain groups could use the power of the state for their own purposes. Say summarized his views of the inevitable conflict that emerges within the state over control and access to government power:

The huge rewards and the advantages which are generally attached to public employment greatly excite ambition and cupidity. They create a violent struggle between those who possess positions and those who want them. Cours comp/et, vol. 2, p. 259.

Some modern observers have seen the beginnings of public choice and a theory of rent-seeking in Say's work on the public sector. Although Patricia J. Euzent and Thomas L. Martin, in "Classical Roots of the Emerging Theory of Rent Seeking: The Contribution of Jean-Baptiste Say," History of Political Economy, (1984, vol. 16, no. 2, pp. 255-62), are correct to identify the beginnings of a theory of rent-seeking in Say's writings, they do not see that this analysis is embedded in a broader theory of exploitation that also involves a sophisticated theory of class.

Two of the most original followers of Say's economic and social theories were the political journalists and academics Charles Comte and Charles Dunoyer. Say's influence on them was profound and the liberalism that resulted from their efforts was an exciting blend of sociological and historical economics.

Comte and Dunoyer developed their new liberal social theory during the Restoration in lengthy articles for their journal Le censeur europeen. Comte began the task with a magnificent reinterpretation of European development from the Greeks to post-revolutionary society. What began as an article called "De l'organisation sociale considérée dans ses rapports avec les moyens de subsistance des peuples," developed over the years into his magnum opus, the Traité de législation ou exposition des lois générales suivant lesquelles les peuples prospère, déperisent, ou restent stationnaires (Paris, 1827) with its echoes of Montesquieu and Smith in its very title.

[p. 6]

Comte, using the categories pioneered by Say, distinguished among three different ways in which wealth could be acquired: one could use the fruits of nature, one could steal from one's fellows, or one could produce one's own goods by industry. Comte then proceeded to analyze European development, using a version of the four-stage theory that had been formulated during the Enlightenment by people such as Turgot and John Millar. Unlike Marxian theories of societal development based on a single mode of production, Comte readily admitted that a mixture of these three modes could exist side by side. The prime aim of his work was to identify the gradual transformation of the economy from various class-dominated and unproductive societies to one where pure industry predominated. The history of the idea of economic stages can be found in Ronald L. Meek, Social Science and the Ignoble Savage (New York: Cambridge University Press, 1976).

The main stages in this transformation from warrior and slave society to pure industrial society were warrior tribal societies, the ancient slave societies of Greece and Rome (towards which both Dunoyer and Comtewere exceedingly hostile), feudalism, which existed up until the French Revolution, and the age of peace and industry immanent in the present. In all these societies, bar the last, there existed "la classe oisive et devorante" [the idle and exploiting class] and "la classe industrieuse"[the industrious class). The precise nature of the productive work that the industrious class did is not important. The vital aspect was that the products of its labor were coercively exploited by those who did not so labor.

There are many surprising parallels with the Marxist idea of economic development of class societies through stages. There is the insight that the mode or modes of production had a decisive influence on culture and politics. One can also find the idea that contradictions within each mode of production lead to a crisis and the transformation of that mode of production into a mode closer to that of pure industry. To give a flavor of their analysis, only one example need be given:

It was natural that the Franks, who were incapable of existing other than by exploiting the industrious men which they had enslaved, despised those amongst themselves who turned to industrial activity. Those who abandoned the trade of pillage in order to become an industrious man renounced the state of barbarism and entered the state of civilisation He abdicated his title of conqueror by joining the conquered class. This was called "deroger" [losing one's noble status]. On the other hand, a man was ennobled when he left the class of industrious or civilized men to enter the idle and parasitic class, in other words, the class of barbarians.

A social organisation as vicious as the Frank's carries within itself the seed of its own destruction. As soon as men who do not belong to the dominant caste discover the secret of creating wealth by their own industry, and as soon as nobles have lost something of equal value in return, the former who are accustomed to order, to work and to economizing increase constantly in numbers, whilst the latter group, not knowing how to produce anything and basing their glory on magnificent consumption, will be reduced in a short time to complete decadence. "De l'organisation sociale " (1817), p. 24-25.

While Comte was examining primitive class societies and ancient slavery, Dunoyer was occupied in elaborating the implications of the future industrial society. What began rather tentatively in their journal Le censeur européen grew into a slim book-length study called L'industrie et moral considérée dans leurs rapports avec la liberté (Paris, 1825), which was later expanded twice into a more substantial work, De la liberté du travail (Paris, 1845).

What they meant by the term industrialism was the use of the economic ideas of Adam Smith and Jean-Baptiste Say to analyze and defend a particular method of organizing society, which gave priority to those who were in the forefront of producing for the market. According to the theory, the producers, when left completely free from all external political constraints, will attempt to satisfy their own needs and at the same time satisfy the needs of others. The result is a harmonious, peaceful, and class-conflict-free social and economic order. Of prime importance for the free operation of economic law and the preservation of peace is the role of the state. Dunoyer went much further than any previous liberal thinker in arguing that the ultimate] industrial state would be at most a night-watchman state and at best nonexistant:

Man's concern is not with government; he should look on government as no more than a very secondary thing - we might almost say a very minor thing. His goal is industry, labor and the production of everything needed for his happiness. In a well-ordered state, the government must only be an adjunct of production, an agency charged by the producers, who pay for it, with protecting their persons and their goods while they work. In a well-ordered state, the largest number of persons must work, and the smallest number must govern. The work of perfection would be reached if all the world worked and no one governed. Le censeur européen, vol. 2, p. 102.

Closely related to Dunoyer's analysis of industry was his analysis of the impediments to its full realization. Of course the main impediment was the state, but unlike other liberals Dunoyer went much further in condemning it In L'industrie et la morale he observed the doubly exploitative nature of the state: it wastes manpower and resources by keeping government officials away from productive jobs as well as employing them specifically to interfere with those who are left to work productively. His most extensive analysis of the state occurs in an article in Le Censeur européen entitled [p. 7] "De l'influence qu'exercent sur le gouvernement les salaires attachés à l'exercise des fonctions publiques," (1819, no. 11, pp. 105-28). Dunoyer combines a public-choice analysis of state employees with an historical analysis of the expansion of the state before, during, and after the revolution, showing its seemingly inexorable rise under all manner of regimes. Once again, class analysis is the guiding principle in his analysis and the experience of the revolution and Napoleon suggests a veritable war between the contending classes for control of the state.

It is impossible for a government to levy taxes and distribute large amounts of money without by that very process creating large numbers of enemies of its authority and those jealous of its power. The government creates large numbers of enemies because it becomes terribly onerous for those who pay the taxes. It creates many who are jealous of its power because it becomes extraordinarily profitable to those who receive the money from the state. The government thus creates a state of unavoidable hostility between those groups who eagerly covet the benefits which the state provides and the richer members of the public who try with all their power to avoid the burdens which are placed on them. In order to prevent any weakening of its power or to prevent power passing into someone else's hands, the government is forced to surround itself with spies, to fill the state's prisons with its political adversaries, to erect scaffolds for hanging, and to arm itself with a thousand instruments of oppression and terror. Le Censeur européen, 1819, 11, p. 112.

Since the Jeffersonian radicals, the so-called Ricardian socialists, and the Restoration French liberals did their pioneering work in liberal class and exploitation theory, many other writers have continued in this tradition. Franz Oppenheimer, Herbert Spencer, Vilfredo Pareto, Gaetano Mosca, Albert Jay Nock, and more recently Murray N. Rothbard are only the most important figures that we could mention in this regard. A more detailed discussion of their work must wait for a future issue of the Humane Studies Review, although we have mentioned them on occasion in past Crosscurrents columns.

The intellectual bankruptcy of Marxism, especially Marxist ideas about class and exploitation, provides modern liberals with a wonderful opportunity to seize the initiative in an important area of historical and political analysis. Marxists themselves are unhappy with their theory of exploitation. They realize that their theoretical neglect of the autonomy of state power has led to some horrible political consequences. The time is ripe for liberals to pursue an alternative view of exploitation and the state. As part of the process of reevaluation of the theory of class, this essay is an attempt to show that a liberal alternative to Marxist theories of class developed in America, Britain, and France in the late eighteenth and early nineteenth centuries.

Recommended Reading

Margaret Levi, "The Predatory Theory of Rule," Politics and Society, 1981, vol. 10, no. 4, pp. 431-465.

Joseph P. Kalt, "Public Goods and the Theory of Government," Cato Journal, 1981, vol. 1, no. 2, pp. 565-584.

Lionel Robbins, The Economic Basis of Class Conflict and Other Essays in Political Economy (London: Macmillan, 1939).

Gianfranco Poggi, The Development of the Modern State: A Sociological Introduction (Stanford University Press, 1978).

Franz Oppenheimer, The State, ed. Chuck Hamilton (New York: Free Life Editions, 1975).

Albert Jay Nock, Our Enemy the State, ed. Walter E. Grinder (New York: Free Life Editions, 1973).

Vilfredo Pareto, Sociological Writings, ed. S. E. Finer (New York: Prager, 1966).

Vilfredo Pareto, The Rise and Fall of the Elites: An Application of Theoretical Sociology, ed. Hans L. Zetterberg (Totowa, New Jersey: The Bedminster Press, 1966).

Gaetano Mosca, The Ruling Class: Elementi di Scienza Politica, ed. Arthur Livingston (New York: McGrawHill, 1939).

Murray N. Rothbard, "The Anatomy of the State," in Egalitarianism as a Revolt against Nature and Other Essays (Washington, D.C.: Libertarian Review Press, 1974).

Walter E. Grinder and John Hagel III, "Toward a Theory of State Capitalism: Ultimate Decision-making and Class Structure," Journal of Libertarian Studies, 1977, vol. 1, no. 1, pp. 59-79.